• Binance recently closed the positions of some Australian traders after incorrectly classifying “wholesale investors”.
• The exchange was forced to close these positions to comply with Australian regulations.
• Binance stated that it will compensate affected users for their losses incurred while trading derivatives on their platform.
Binance Closes Positions of Australian Traders
Binance, one of the world’s largest cryptocurrency exchanges, recently confirmed that it closed the positions of some Australian traders. This decision was taken after incorrectly classifying them as “wholesale investors” in accordance with local regulations.
Affected Users To Be Compensated
The crypto exchange has informed all impacted users and is working on a remediation and compensation plan to cover any losses incurred by them while trading derivatives on its platform. Furthermore, affected users will be contacted if there are any issues with their current or closed accounts.
Australian Regulations On Cryptocurrency Trading
In Australia, cryptocurrency trading is strictly classified into retail and institutional customers, with only “sophisticated investors” having access to these accounts. Thus, all users must meet certain criteria such as net asset value and investment experience in order to trade derivatives on Binance’s platform.
Debate And Controversy Over Decision
The decision has stirred up debate and controversy across social media platforms. Many questioned whether the compensation plan would cover only recent activity or all activity since the accounts were opened.
Despite the confusion surrounding Binance’s decision, it is clear that Australian regulations are strict when it comes to cryptocurrency trading. As a result, all users must ensure they meet certain criteria in order to access derivative contracts offered by crypto exchanges like Binance.