• Binance Australia has closed the derivatives trading accounts of some wholesale investors in Australia after an internal investigation.
• Binance only allows wholesale investors to trade crypto derivatives, and retail investors are not allowed to do so.
• The exchange is compensating the impacted users for their losses incurred while trading derivatives on Binance.
Binance Closes Derivatives Trading Accounts For Wholesale Investors
Binance Australia has announced that it has closed the derivative trading accounts of some wholesale investors in Australia. According to an internal investigation by the exchange, these users did not meet the requirements for wholesale investors. This move was done in order to remain compliant with local laws and regulations that only allow such products to be traded by approved clients.
Derivative Trading Accounts Closed
The incorrectly labeled accounts have been shut down as a result of this review, and those affected are now unable to access the derivatives market on Binance. A spokesperson for Binance Australia stated that around 500 Australian users were impacted by this remediation action taken by the exchange.
Compensation Plan In The Works
Binance tweeted about its plans to compensate those affected by this move, stating that they had already contacted all impacted users and will fully compensate them for their losses incurred while trading derivatives on Binance. Additionally, the exchange stated that it was in contact with these individuals to firm up its compensation plans for them.
Local Laws & Regulations Followed
The action taken by Binance was necessary in order to stay compliant with local regulations that allow only wholesale investors to trade such products. This is why retail customers are not allowed to engage in futures or financial derivative activities on the platform either.
In conclusion, Binance Australia’s decision to close certain derivative trading accounts of some wholesale investors was necessary due to regulatory restrictions which only permit approved clients from engaging in such activities on its platform. It is reassuring that the company will also be providing full compensation for any losses incurred during these transactions as well