Australian Regulator Cancels Binance’s Derivatives License
- The cancellation comes after a targeted review of Binance’s financial services business in Australia.
- The exchange has been ordered to close all open derivative positions by April 21.
The regulatory concerns surrounding Binance’s operations seem to be mounting up as Australia’s top securities regulator announced earlier today that it had canceled the derivatives license of the crypto exchange’s Australian arm.
According to a press release from the Australian Securities and Investment Commission (ASIC), Oztures Trading Pty Ltd’s derivatives license, which is officially known as an Australian Financial Services (AFS) license, has been canceled. Oztures Trading operates Binance Australia Derivatives in the country.
The securities regulator stated that the decision to cancel Binance’s derivatives license was taken after a targeted review of its financial services business in Australia. The review focused on areas including the crypto exchange’s classification of retail and wholesale clients, as well as the extent of harm to consumers. The review is still in progress.
Speaking on the matter, ASIC Chair Joe Longo stated, “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.”
As per the terms of the cancellation, Binance Australia’s users will not be able to open new derivatives positions on the platform after April 14, 2023. The securities regulator has ordered the crypto exchange to close all open derivatives positions on April 21, 2023, should its clients leave any of them open till then.
The Australian Securities and Investment Commission cited the Commodities and Futures Exchange Commission’s (CFTC) lawsuit against Binance in its press release. The regulator also cited regulatory warnings and actions from other regulators including the UK’s Financial Conduct Authority, the Monetary Authority of Singapore, and the Ontario Securities Commission.