Key Insights:
- ASIC targeted Binance Australia and terminated its derivatives license.
- Binance Australia’s spot exchange will continue despite the cancellation.
- This license revocation adds to the regulatory scrutiny of Binance and its founder.
Changpeng Zhao, the CEO of Binance, used Twitter to clear up any confusion or concern about Binance Australia. He tweeted that Binance Australia had asked that its derivatives license be revoked, which the Australian Securities and Investments Commission (ASIC) did at the cryptocurrency exchange’s request.
Binance Australia adapts to regulatory changes
According to Zhao’s tweet, Binance Australia had only 104 users when ASIC canceled the derivatives license. However, Zhao assured that the spot exchange in Australia would still be active. Binance recently announced that it had adopted a more targeted strategy in Australia by discontinuing the Binance Australia Derivatives business after engaging with ASIC.
In a tweet accompanied by a picture of the ASIC report, Zhao said that the reason for the cancellation was that “a request to cancel was received from Binance yesterday.” In addition, the report provides an in-depth description of the further measures that will be taken following the cancellation.
Aussie finance limits imposed
According to the laws set out by ASIC, an AFS license is obligatory for anyone who wants to run firms in Australia that provide financial services. Therefore, if a firm revokes its derivatives license, certain financial products can no longer be offered to its customers in Australia.
Binance Australia’s derivative license was terminated due to a “targeted review” by the regulator to examine if the exchange violated its license by offering these trading alternatives to retail customers. The ASIC has previously warned that it would take action against exchanges that did not adhere to Australian rules and regulations. Furthermore, the license revocation is the most recent illustration of the escalating regulatory scrutiny on the world’s largest cryptocurrency exchange and its creator.
