Binance License Cancelled by ASIC at Exchange’s Request

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The
Australian markets regulator, ASIC , informed on Thursday that it canceled a financial
markets license held by Binance Australia Derivatives, operated by Oztures
Trading Pty Ltd. Although at first glance, it may seem that the regulatory
hurdles of the renowned crypto exchange seem to have no end, this time, the
decision to withdraw the license was made by Binance itself.

However, it
came after the regulator held a hearing last week, considering
whether it should suspend or cancel the license held by Oztures Trading.

According
to the ASIC statement, starting from 14 April 2023, it will not be possible for
clients to increase their derivatives positions or open new positions with
Binance. Additionally, the crypto exchange will require all clients to close
any existing derivative positions they may have before 21 April 2023. If they
fail to do so, the exchange that day will close all remaining trades
automatically.

The supervisor
has been executing a focused evaluation of Binance’s financial services
operations within Australia, with particular attention to the categorization of
retail and wholesale consumers. On 29 March 2023, ASIC served a hearing notice
to assess whether the AFS license held by Oztures Trading Pty Ltd should be
revoked or put on hold.

“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,” Joe Longo, the Chairman at ASIC, commented.

The
stipulations surrounding the termination encompass a clause stating that the
annulment will not impact Binance’s obligation to remain a part of the
Australian Financial Complaints Authority until 8 April 2024.

Taking the
opportunity, ASIC reminds that cryptocurrencies are a risky and complicated
financial instrument, and cryptocurrency derivatives carry additional risks due
to leverage.

Binance’s Regulatory
Hurdles

ASIC, in
its announcement regarding the cancellation of Binance’s license, reminds that on 27 March 2023 the US Commodities Futures Trading Commission (CFTC ) declared
that it has initiated a civil enforcement lawsuit in the US District Court for
the Northern District of Illinois. It accused Changpeng Zhao, the CEO of the
Binance Group, and three organizations responsible for Binance’s operations of
multiple breaches of the Commodity Exchange Act (CEA) and CFTC regulations.

A mere
hours following the CFTC’ legal action, Binance’s CZ, openly dismissed the
accusations as “unexpected and disappointing,” characterized by
“an incomplete recitation of facts.” In a concise retort via an
official blog entry, Zhao denied all the primary claims, ensuring that
comprehensive responses will be provided in due course.

Earlier,
many other overseas regulators published their own warnings regarding Binance
operations. There are at least seven regulators on the list, including the UK’s
FCA, Japan’s FSA, Italy’s CONSOB, Singapore’s MAS, Netherlands Central Bank,
Ontario Securities Commission and Thailand’s SEC.

Despite the
regulatory problems that have dogged Binance since at least 2021, the exchange achieved
its largest market share among other cryptocurrency exchanges in March. Binance’s
popularity grew despite declining volumes at other major exchange offerings and
the US legal issues with the BUSD stablecoin.

FCA
Stops WealthTek and RoboForex Increases Partner Commissions. Read
today’s news nuggets!

The
Australian markets regulator, ASIC , informed on Thursday that it canceled a financial
markets license held by Binance Australia Derivatives, operated by Oztures
Trading Pty Ltd. Although at first glance, it may seem that the regulatory
hurdles of the renowned crypto exchange seem to have no end, this time, the
decision to withdraw the license was made by Binance itself.

However, it
came after the regulator held a hearing last week, considering
whether it should suspend or cancel the license held by Oztures Trading.

According
to the ASIC statement, starting from 14 April 2023, it will not be possible for
clients to increase their derivatives positions or open new positions with
Binance. Additionally, the crypto exchange will require all clients to close
any existing derivative positions they may have before 21 April 2023. If they
fail to do so, the exchange that day will close all remaining trades
automatically.

The supervisor
has been executing a focused evaluation of Binance’s financial services
operations within Australia, with particular attention to the categorization of
retail and wholesale consumers. On 29 March 2023, ASIC served a hearing notice
to assess whether the AFS license held by Oztures Trading Pty Ltd should be
revoked or put on hold.

“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,” Joe Longo, the Chairman at ASIC, commented.

The
stipulations surrounding the termination encompass a clause stating that the
annulment will not impact Binance’s obligation to remain a part of the
Australian Financial Complaints Authority until 8 April 2024.

Taking the
opportunity, ASIC reminds that cryptocurrencies are a risky and complicated
financial instrument, and cryptocurrency derivatives carry additional risks due
to leverage.

Binance’s Regulatory
Hurdles

ASIC, in
its announcement regarding the cancellation of Binance’s license, reminds that on 27 March 2023 the US Commodities Futures Trading Commission (CFTC ) declared
that it has initiated a civil enforcement lawsuit in the US District Court for
the Northern District of Illinois. It accused Changpeng Zhao, the CEO of the
Binance Group, and three organizations responsible for Binance’s operations of
multiple breaches of the Commodity Exchange Act (CEA) and CFTC regulations.

A mere
hours following the CFTC’ legal action, Binance’s CZ, openly dismissed the
accusations as “unexpected and disappointing,” characterized by
“an incomplete recitation of facts.” In a concise retort via an
official blog entry, Zhao denied all the primary claims, ensuring that
comprehensive responses will be provided in due course.

Earlier,
many other overseas regulators published their own warnings regarding Binance
operations. There are at least seven regulators on the list, including the UK’s
FCA, Japan’s FSA, Italy’s CONSOB, Singapore’s MAS, Netherlands Central Bank,
Ontario Securities Commission and Thailand’s SEC.

Despite the
regulatory problems that have dogged Binance since at least 2021, the exchange achieved
its largest market share among other cryptocurrency exchanges in March. Binance’s
popularity grew despite declining volumes at other major exchange offerings and
the US legal issues with the BUSD stablecoin.

FCA
Stops WealthTek and RoboForex Increases Partner Commissions. Read
today’s news nuggets!



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