Binance has been under fire from the commodities and futures trading commission (CFTC) in the US recently. It seems the exchange’s regulatory challenges have escalated as more countries have come against it.
The Australian Securities & Investments Commission (ASIC) announced last week that it had cancelled Binance’s license in the country. The license which allows Binance to operate as a derivatives exchange was issued by the Australian financial services (AFS).
This comes after a a “targeted review of Binance financial services business in Australia, including its classification of retail and wholesale clients.” After issuing a notice of hearing to decide whether or not to cancel or suspend Binance’s financial services license, the commission decided to go with the former.
With the cancellation of Binance’s Australian license, derivatives clients won’t be able to open new positions, or increase existing positions starting 14 April. Binance may have failed to comply with license obligations as it is one of the reasons a license may be cancelled.
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Dubai Turns on Binance
Dubai has been a very friendly environment for Binance to operate. Indeed, it was rumored that Binance CEO Changpeng Zhao (CZ) considered establishing the exchange’s headquarters in the UAE region because of the friendly crypto environment, but that may be about to change soon.
According to a Bloomberg report, the UAE’s Virtual Assets Regulatory Authority (VARA) has demanded that Binance provides more detailed information on its ownership structure, governance and auditing procedures. In response Binance told Bloomberg that it “disclosed all necessary answers to VARA on a proactive basis.”
This is not an isolated case though, as the UAE is asking for similar details from other exchanges operating in the region, including Crypto.com, GC Exchange, Hex Trust and Komainu. Dubai is reportedly doing this to level up its regulatory standards and get its name off the Financial Action Task Force (FATF) ‘jurisdictions under increased monitoring’ list.
CFTC Lawsuit Escalates to Ireland
The CFTC in the US had accused the world’s largest crypto exchange of “willfully” avoiding regulations and breaking federal laws. Several allegations have been filed against the exchange in a lawsuit in which the commission seeks to stop its operations in the country.
It seems there’s more to it though, as the case has spread to Ireland where two of Binance’s bases have been named, including Binance Services Holdings and Binance Holdings IE, both under the directorship of CZ. The Irish Times reports that documents filed this week suggest CZ resigned from the directorship on January 18.
Reacting to the report, a Binance spokesperson said CZ “proactively resigned … to help focus his attention on leadership of the Binance group as co-founder and CEO.”
It is unlikely that the Irish authorities believe this though, and seems determined to dig further into the case. All these allegations are coming around the same time, which could significantly damage Binance’s reputation in multiple countries.