Australian regulators have stripped Binance Australia of its financial services license following a request from the company just a day prior.
The Australian Securities and Investments Commission (ASIC) has been investigating Binance after it had misclassified retail and wholesale clients, giving retail clients the opportunity to purchase risky products that should only have been available to wholesale clients.
Conversations around suspending or canceling Binance’s Australian Financial Services (AFS) license have been in conversation since March 29.
“It is critically important that AFS licensees classify retail and wholesale clients in accordance with the law,” ASIC Chair Joe Longo said in a statement.
“Retail clients trading in crypto derivatives are afforded important rights and consumer protections under financial services laws in Australia, including access to external dispute resolution through the Australian Financial Complaints Authority,” Longo said.
Australian clients must begin unwinding their derivative investments immediately, and Binance will have until April 21 to ensure all derivative positions are closed.
This latest move from Australian authorities follows the US CFTC’s probe into the centralized exchange and its founder and CEO Changpeng Zhao.
Binance is also being investigated by authorities in the UK, Japan, Italy, Singapore, Netherlands, Canada and Thailand.
ASIC has been carefully evaluating the risk of trading cryptocurrencies, warning consumers of its risks.
“Many crypto products and services are not regulated by ASIC. More than with other types of investments, crypto users should be prepared to lose any funds they invest in crypto,” ASIC said in a statement.
Binance Australia customers will still be able to use its spot exchange product. A spokesperson for the company was not immediately available for comment.
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Source: https://blockworks.co/news/binance-loses-australia-license