By George Ward
Reports indicate that the Australian Securities and Investments Commission (ASIC) has started reviewing Binance Australia’s derivatives service. The latest development comes after Binance admitted that it mistakenly labeled 500 Aussies users as wholesale investors.
Reviewing Binance Australia Operations
Furthermore, due to tagging 500 Australian users as “wholesale investors,” the affected individuals have seen their derivative positions closed by the regulators. ASIC prohibits Australian retail traders from participating in futures trading and financial derivatives.
Meanwhile, the review by ASIC includes Binance’s classification of both retail and wholesale users, said a spokesperson for the Australian market regulator. According to the ASIC spokesperson, the commission is aware of social media posts made by Binance to clarify that it incorrectly grouped some Australian users as wholesale investors.
However, the exchange has yet to report the incidents to ASIC in agreement with its obligation under the Australian Financial Services License. In a tweet on Thursday, Binance revealed that it has contacted all affected users and will compensate them for the losses they incurred while trading derivatives.
Historically, Binance Australia does not permit retail traders to trade in futures and financial derivatives tools on its platform in compliance with local guidelines.
US SEC Opposes Binance.US $1B Voyager Deal
Binance.US’s recent move to strike a $1.02 billion deal to acquire the assets of the nonoperational crypto lender Voyager Digital has been objected to by both the New York and Federal financial watchdogs. In their February 22 filings, the regulators disclosed that allowing the deal to sail through would be discriminatory and unlawful.
Furthermore, the opposition to the $1 billion Voyager deal comes amid an increasing crackdown on crypto firms by the Securities and Exchange Commission (SEC). The regulator is reportedly after Kraken over allegations that the exchange is trading in unregistered securities, which forced it to halt its staking offerings in the US.
The SEC believes that elements of the latest deal between Binance.US and Voyager may have violated the law considering the plan involves repaying Voyager’s former customers their initial capital without involving the regulator.
Apart from the SEC, the New York State Department of Financial Services (NYDFS), in a February 22 filing, alleges that Voyager Digital was serving residents of the state in violation of New York’s jurisdiction rules on digital assets.