Binance Australia Derivatives users reported sudden alerts sent by the digital asset platform on February 23 saying it was beginning to close certain derivatives positions and accounts.
According to images posted by various users on Twitter, users who did not meet the requirements to be a “wholesale investor” were told that all their positions would be closed and they would no longer be able to access the Binance Australia Derivatives Platform.
Binance has suddenly closed derivatives positions for many Australian users #Australia #binance pic.twitter.com/4t1gL08oK6
— Moidul Islam (@Mi_moidulislam1) February 23, 2023
Users have been informed that in order to continue using the Binance Australia derivatives platform, they must provide the necessary evidence to meet the requirements to be classified as a “wholesale investor”.
The announcement further stated that Binance Australia Derivatives is working on a remedial and compensation plan for users owed any refunds in light of the update.
He then stated that the actions that followed were in accordance with local regulations in Australia and therefore users were immediately contacted and the affected accounts were closed.
Our team identified a small number of Australian users who were misclassified as “wholesale investors” on Binance.
Under Australian regulations, we were required to notify these users and close out any of their own derivative positions with immediate effect.
— Binance (@binance) February 23, 2023
Binance Australia Derivatives is the official trading name of Oztures Trading Pty Ltd. The relationship with Binance is that its local office in Australia is the corporate authorized representative of Oztures.
Related: Australian regulator raises concerns about FTX months before collapse: Report
In his official overview published in July 2022 clearly states that derivative products are only offered to Australian wholesale clients.
However, users responded to Binance’s Twitter post with one user from Australia claiming that they could no longer stake their crypto due to regional issues. Another claimed that flexible earnings no longer exist available in Australia, to which the Binance support team responded to look into the issue.
Earlier in February, Australia has beefed up its watchdogs for the crypto space as part of its “multi-phase” anti-fraud plan.