Australia’s corporate regulator Australian Securities and Investments Commission (ASIC), said in a press release Thursday it has canceled Binance Australia’s derivatives license following a targeted review of the company’s classification of retail and wholesale clients. The crypto exchange has been instructed to close all open positions on its derivatives platform by April 21.
Binance Australia’s License Canceled due to its Classification of Retail and Wholesale Users
Binance’s Australian arm said it was shutting down its derivatives business after the country’s corporate regulator ASIC canceled the world’s biggest crypto exchange’s license. According to ASIC’s press release, the regulator ordered Binance Australia to close all open derivatives positions by April 21.
In a separate statement, Binance said it would wind down its derivatives operations in Australia “to pursue a more focused approach” in the country. The company also said it had notified the remaining users on Binance Australia Derivatives, around 100, to inform them about the decision.
The move comes after ASIC conducted a “targeted review of Binance financial services business in Australia, including its classification of retail and wholesale clients.” The review of such matters is ongoing, said ASIC Chair Joe Longo, focusing on the extent of consumer harm.
“It is critically important that AFS licensees classify retail and wholesale clients in accordance with the law. Retail clients trading in crypto derivatives are afforded important rights and consumer protections under financial services laws in Australia, including access to external dispute resolution through the Australian Financial Complaints Authority.”
– said ASIC Chair Joe Longo.
Binance’s Spot Business in Australia to Continue Operating Normally
Binance said the move does not affect its spot business in Australia, which has more than one million users. It added that shutting down derivatives operations would not impact its commitment to developing the crypto industry.
But the company continues to attract global regulators’ attention. Last week, the US Commodity Futures Trading Commission (CFTC) sued Binance for deliberately evading federal law and operating an illegal crypto derivatives exchange in the US.
Similarly, it was reported last week that Binance had allegedly concealed its links to China “for several years,” despite saying it exited the market following the regulatory crackdown in 2017. As a result of being in the regulators’ crosshairs, Binance’s market share declined by 16% between March and April, though its US affiliate saw its market share triple during that period.
This article originally appeared on The Tokenist
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