- Binance Australia’s office is being searched by Australian regulators as part of a derivatives probe.
- Binance is cooperating with authorities to meet local regulatory standards in Australia.
- The news comes after ASIC revoked the exchange’s Australia Derivatives license.
According to a report from Bloomberg on Wednesday, Binance Australia’s office was searched by the Australian securities regulator as a part of a probe into its recently defunct local derivatives business. Unnamed sources reported that the Australian Securities and Investments Commission (ASIC), the regulatory body overseeing corporate and securities matters in the country, conducted the search on Tuesday.
A spokesperson for Binance told Reuters:
We are cooperating with local authorities and Binance is focused on meeting local regulatory standards in order to serve our users in Australia in a fully compliant manner.
This news comes after ASIC revoked the license of Binance Australia Derivatives in April, following a focused examination of Binance’s activities in the country, particularly regarding the classification of retail and wholesale clients on the platform. In response to ASIC canceling the license, Binance made the decision to cease derivatives trading operations in Australia and instead adopt a more targeted strategy.
Binance CEO Changpeng Zhao stated that Binance Australia had only 104 users in a tweet from April 6. However, he confirmed that Binance’s spot cryptocurrency exchange in Australia would continue its operations.
There are some misinformation (and confusion) about #Binance Australia.@Binance_AUS requested to cancel the derivatives license yesterday. The platform had exactly 104 users as of yesterday.@Binance_AUS will CONTINUE to operate the spot exchange in AU. pic.twitter.com/nEExtG4U90— CZ Binance (@cz_binance) April 6, 2023
Australian regulators initiated an investigation into Binance following the sudden closure of certain derivatives positions in February. Binance attributed the investigation to the legal status of some of its users, who did not meet Australia’s criteria for classification as wholesale investors.
The largest cryptocurrency exchange globally is currently facing regulatory lawsuits and investigations across multiple jurisdictions. In March, the U.S. Commodities Futures Trading Commission (CFTC) filed a lawsuit against Binance and its founder Changpeng Zhao, accusing the firm of operating an exchange deemed “illegal” by the regulator.
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