In an announcement on its blog, Binance said the move was part of its constant evaluation of products and services to comply with local regulations. As part of the policy change, the exchange will also stop offering leveraged tokens to its Australian users.
As of Sept 24, Australian users have 90 days to reduce and close their positions for these products. Until then, users can top-up margin balances to prevent margin calls and liquidations. However, they will not be able to increase or open new positions. After midnight on Dec 24, these users will no longer be able to manually reduce or close their positions.
Binance faces intensified scrutiny
These changes are likely due to the regulatory scrutiny that the exchange has faced in recent months. Earlier this week, the United States Commodity Futures Trading Commission (CFTC) instigated a probe into allegations of insider trading occurring within Binance. The latest allegations concern whether “Binance or its staff” have taken “advantage of its customers” by using publicly undisclosed insider information to illicitly reap profits through market manipulation.
This probe represents an expansion of an ongoing investigation into Binance by government authorities in the United States. The country’s Department of Justice (DoJ) and Internal Revenue Service (IRS) are already looking into claims of money laundering and tax fraud.
Meanwhile, Binance has also been stepping up its efforts to appease regulators. Over the weekend, Binance introduced a user verification policy for asset and institutional protection from criminal activity. Users will now require an intermediate verification step to access product offerings and services, including deposits, trades, and withdrawals. Binance sees this as a step towards boosting its reputation with banks and other partners, by increasing assurance that global exchanges such as theirs are able to operate safely.
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