1 year ago
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Australia’s Binance to close derivatives division
The Australian Securities and Investments Commission (ASIC) has announced that it has revoked the license of Binance Australia Derivatives, the Australian derivatives arm of cryptocurrency exchange Binance.
The license is said to have been made following a revocation request submitted by Binance on May 5.
There are some misinformation (and confusion) about #Binance Australia.@Binance_AUS requested to cancel the derivatives license yesterday.@Binance_AUS will CONTINUE to operate the spot exchange in AU. pic.twitter.com/nEExtG4U90
— CZ 
Binance (@cz_binance) April 6, 2023
As Binance CEO Changpong Zhao (CZ) added, the company will continue to provide spot trading services in Australia. Binance said in an official statement:
Following recent discussions with the Securities and Investments Commission, Binance decided to end its derivatives services in Australia and focus more on its business there.
It will operate around an Australian-registered cryptocurrency spot exchange operated by Binance Australia. Australian users will continue to have access to the spot trading platform.
According to the Australian Securities and Investments Commission (ASIC), after April 14th, users will not be able to increase or open new derivative positions on Binance Australia, and all positions will be liquidated by the 21st. There is a need to.
What are derivatives
Financial products derived from underlying assets such as virtual currencies and stocks. The English notation is “derivative” which means “derived”. Also called “financial derivatives” in Japanese. Representative derivatives include futures trading, option trading, and swap trading. They are used to reduce the risk in trading the underlying asset or simply to pursue higher profitability.
Cryptocurrency Glossary
Description of Australian authorities
ASIC explained that the risk of retail customers trading cryptocurrency derivatives appears to have been a concern for regulators. ASIC Chairman Joe Longo explained:
It is critical that financial services licensees classify retail and wholesale customers according to law.
Retail customers trading cryptocurrency derivatives have important rights and consumer protections under Australian financial services law, including access to external dispute resolution through the Australian Financial Complaints Authority.
In line with the regulations, this time, Binance will also be required to remain a member of the Australian Financial Complaints Authority until April 8, 2024, even after the derivatives services are terminated.
ASIC, whose regulation focuses on consumer protection and market integrity, said it had also conducted an assessment of Binance’s financial services operations in Australia, including distinguishing between retail and wholesale customers.
ASIC has a history of warning about the risks cryptocurrencies pose to consumers, especially those of leveraged cryptocurrency derivatives.
ASIC also noted that the U.S. Commodity Futures Trading Commission (CFTC) has sued Binance for providing, among other things, unregistered U.S. resident derivatives trading services. This, too, may have made ASIC concerned in terms of consumer protection.
connection: US CFTC chairman “I’m confident in Binance’s lawsuit”
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English (US) ·