Michaela Alvez
The Australian Securities and Investments Commission (ASIC) has filed a lawsuit against Binance Australia Derivatives, accusing the crypto trading platform of failing to uphold consumer protections.
In a media release issued on December 18, the regulator alleged that Binance provided crypto derivative products to 505 retail investors in Australia between July 2022 and April 2023, wrongly classifying them as wholesale clients.
The lawsuit claims that, as a result of the misclassification, Binance’s retail customers were denied the consumer protections typically provided to smaller investors, such as access to Product Disclosure Statements (PDS), a Target Market Determination (TMD), and internal dispute resolution procedures.
According to ASIC’s legal filing, the products available on Binance’s Australian derivatives exchange include futures contracts for Bitcoin, Ether, and BNB, the latter being Binance’s own cryptocurrency.
ASIC Deputy Chair Sarah Court said that many clients suffered significant financial losses. “In 2023, we oversaw compensation payments by Binance of approximately $13 million to affected clients,” Court added.
In April 2023, after reviewing its operations, ASIC revoked the company’s Australian financial services license following a request for cancellation made by Binance itself.
The regulatory body recently intensified its crackdown on the cryptocurrency industry, as part of a broader effort to tighten oversight of the growing digital asset market in Australia.
Earlier this week, ASIC took action against BitTrade, which was fined AUD 5.1 million (approximately USD 3.2 million) by the Australian Federal Court. The fine came after BitTrade was found to have offered a margin lending product to customers without obtaining the necessary regulatory approval.
Simultaneously, Mark Longo, the owner of the viral internet sensation Peanut the Squirrel, took legal action against Binance. He claimed the crypto exchange used the “PNUT” trademark and a popular image of Peanut on its platform without securing the necessary permissions.
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Michaela has no crypto positions and does not hold any crypto assets. This article is provided for informational purposes only and should not be construed as financial advice. The Shib Magazine and The Shib Daily are the official media and publications of the Shiba Inu cryptocurrency project. Readers are encouraged to conduct their own research and consult with a qualified financial adviser before making any investment decisions.
