On Thursday, the Australian Securities and Investments Commission (ASIC) announced revoking Binance Australia's derivatives license. Binance Australia, a subsidiary of the world's leading crypto exchange by trading volume, was directed by the regulator to close all open derivatives positions for clients by April 21.
ASIC's Review of Binance's Operations
The press release mentioned that ASIC has been conducting a targeted review of Binance's businesses to ensure compliance with local regulations.
Importance of Retail and Wholesale Client Classification
ASIC Chair Joe Longo emphasized the significance of correctly classifying retail and wholesale clients per Australian law. He noted that retail clients trading in crypto derivatives are entitled to key rights and consumer protections, including access to external dispute resolution through the Australian Financial Complaints Authority.
ASIC's Stance on Crypto Regulation in Australia
Longo added that ASIC supports establishing a regulatory framework for cryptocurrencies in Australia, but the final decision rests with the government.
Binance's Legal Troubles with U.S. Regulators
Binance faced regulatory scrutiny last week when the U.S. Commodity Futures Trading Commission (CFTC) filed a lawsuit against the exchange for allegedly operating derivatives products in America.
Binance Australia's Response and Future Plans
In response to the license cancellation, Binance Australia stated that it is "winding down" its derivatives product to focus on a more specialized approach. In an interview with the Sydney Morning Herald, former Binance Australia CEO Leigh Travers, who resigned on March 10, revealed that the exchange had over one million users as of December.