On Thursday, the Australian Securities and Investment Commission announced that it had canceled Binance’s derivative license, effective immediately.
The Australian regulator revealed that it canceled the license after Binance requested on Wednesday that the action be carried out. ASIC also disclosed that it had closely monitored the activities of the largest crypto exchange in the world and had an action planned out before the request came in.
“ASIC has been reviewing the Binance operations for some time and has further engagement planned, which may have prompted Binance to take this action,” ASIC chairman, Joe Longo stated on Thursday.
Binance Winds Down Derivative Trading in Australia
Binance entered the Australian derivatives market by acquiring the majority of stakes in Oztures Trading, an Australian Finance Services Licensed trading platform. The exchange, however, has decided against continuing operations in the country.
Before the notice, Binance had already started its wind-down process, having stopped offering derivative trading services to retail traders back in February and is currently refunding investors. Binance confirmed it had contacted its derivatives wholesale customers about its intention to stop servicing them.
The head of operations in Australia, Ben Rose, however, noted that the derivatives withdrawal doesn’t affect its spot trading services, noting that “customers can continue to enjoy the use of its spot exchange product.”
ASIC Queried Binance’s Regulation Adherence
The Australian regulator disclosed that it was investigating whether Binance was fully compliant with its laid down regulatory constraints before the wind-down. ASIC opened an interrogation into CZ’s Binance’s adherence to not offering derivative trading services to retail traders.
Binance has come under scrutiny in recent times for its compliance with regulatory laws, with the Commodity Futures Trading Commission stating that the exchange had a “sham” compliance program. Jim Cramer also noted that Binance was “too sketchy” to do business with, and he would avoid using the platform as an investor.
ASIC noted that it would continue to monitor Bianace’s operations, including the derivative trading wind-down process. The regulator stated that it had foreknowledge of the disadvantages unregistered products bring to investors and is ready to see that exchanges fully comply with regulatory guidelines.
