On Wednesday, April 5th, Binance had registered a plea for the cancellation of the license issued to them previously. Subsequently, Thursday saw the Australian Securities and Investments Commission revoking the company’s financial services permit that was held by the company’s exchange derivative Oztures Trading as requested. The ASIC was conducting an analysis of the finances of Binance in Australia since February this year after they recognized that a few investors were listed wrongly as ‘wholesale investors’. Following this declaration, ASIC Chair Mr. Joseph highlighted the importance of correct classification of clients as retail or wholesale investors by the licensed organizations. The Australian regulations had considered in late March if the license of the crypto giant should be revoked or suspended temporarily. The license enabled Oztures to grant derivatives which are contracts that gain or lose value based on the value of their underlying assets and exchange agreements. It was also used for financial counseling of clients about selected commodities.
What is means for Binance:
The cancellation has no effect on the membership of Binance in the Australian Financial Complaints Authority till 8th of April, 2024 as was previously decided. Binance Australia also took to twitter informing clients that their efforts would now be focused on their locally registered spot exchange.
We are winding down our local derivatives exchange to focus our efforts on our locally registered spot exchange.
Read more about it here: https://t.co/yMqiqPCO0F
— Binance Australia (@Binance_AUS) April 6, 2023
Regulatory Warnings from other countries:
Australia has joined a long list of other countries who have faced complications with Binance. The US CTFC took Binance and its founder to court for allegedly carrying out illegal exchanges. Other countries who hit the crypto giant include the United Kingdom (FCA), Japan (JFSA), Italy (CONSOB), Singapore (MAS), Netherlands (DNB), Canada (Ontorio SC) and Thailand. The series of measures taken against the crypto-currency giant have attracted attention from crypto users worldwide.
What’s Next for Binance’s Australian Clients:
Australian investors will not be permitted to change their derivative positions or acquire new ones after April 14th. They would also need to shut down all their contracts based on underlying assets by April 21st, failing which the positions that are still left will be ended. ASIC also warned crypto enthusiasts about the dangers involved in the system, ASIC Lead Mr. Joseph Longo was also said that they assist a governmental structure for crypto currencies with user protection and market integrity as the basis. He further added that the final verdict regarding the rules of regulation is one for Government,”.
With investigations and probes from departments of about 8 countries around the world accumulating month after month, Binance CEO Mr. Zhao and his legal team will have a difficult time in the next few weeks. While they have responded positively to all the proceedings taking place as per international law and laws of concerned nations, serious repercussions could follow if the same events continue to occur.