Home CryptocurrencyBitcoin Australian regulators are reviewing Binance Australia derivatives for account closures

Australian regulators are reviewing Binance Australia derivatives for account closures

by SuperiorInvest

Binance Australia Derivatives sent a sudden message to a select group of users on February 23, saying that they would immediately terminate their accounts due to the false classification of some users as “wholesale clients”.

The incident sparked a wave of responses from users on social media, and the following day the Australian Securities and Investments Commission (ASIC) announced it would conduct a “targeted review” of Binance’s local derivatives operations.

According to a February 24 statement from the regulator’s spokesperson, the review of Binance Australia Derivatives will include “the classification of retail clients and wholesale clients”.

The spokesperson added:

“It has not yet reported these matters to ASIC in accordance with its obligations under the Australian Financial Services Licence.”

However, a spokesperson said the regulator was “aware of Binance’s social media posts” that were made shortly after users began posting screenshots of the notifications on Twitter.

Binance took to social media to clarify the incident, saying it had closed derivatives positions and accounts for some users it misclassified as “wholesale clients.” Currently, the platform is only available to wholesale investors.

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A few hours after the first posts, Binance said that 500 users were affected by the fix.

A spokesperson for Binance reiterated that the exchange is “committed” to complying with local Australian laws.

Changpeng “CZ” Zhao, co-founder and CEO of Binance, said on Twitter that all users will be compensated for any losses and ignore FUD. He also mentioned that the company is looking into the situation to see if reopening futures in Australia will be an option in the future.

The Binance cryptocurrency exchange is and has been the largest in the world very public about their efforts to comply with the regulatory requirements of local operations.

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