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Australian Markets Regulator Is Reviewing Binance Australia's Derivatives Services
Binance said on Thursday it had incorrectly tagged 500 Australian users as "wholesale investors."
By Amitoj Singh
Updated Feb 24, 2023, 3:13 p.m. Published Feb 24, 2023, 7:33 a.m.
Australian Securities and Investments Commission (ASIC), is conducting a targeted review of Binance Australia's derivatives business, the regulator said on Friday.
The development comes a day after Binance said that it had incorrectly tagged 500 Australian users as "wholesale investors," resulting in their derivative positions being unceremoniously closed. Local regulations do not allow retail traders to trade futures and financial derivatives.
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Binance said that it had already contacted all impacted users and would fully compensate them.
The review by the Australian markets regulator includes the entity's "classification of retail clients and wholesale clients," an ASIC spokesperson said.
"ASIC is aware of Binance’s social media posts overnight stating that it had incorrectly classed a group of Australian consumers as wholesale investors. It has not yet reported these matters to ASIC in accordance with its obligations under its Australian Financial Services Licence."
Binance did not immediately respond to CoinDesk's request for comment.
Read More: Binance Closed Derivative Positions of 500 Australian Users, Will Compensate Them for Losses
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