ASIC forces Binance to compensate users for losses
ASIC forces Binance to compensate users for losses
The Australian Securities and Investments Commission (ASIC) has released information about payments to Binance Australia Derivatives users for breaching rules relating to user misclassification.
Between July 7, 2022, and February 25, 2023, as a result of the misclassification, Binance Australia Derivatives (also known as Oztures Trading Pty Ltd) failed to protect its clients when trading OTC derivatives and therefore had to compensate users for "net trading losses and commissions" of approximately $13.1 million.
According to the ASIC press release, Binance paid approximately $7.8 million in compensation to 505 users between May and June 2023 and paid more than $5.2 million in additional compensation to an additional 18 users in September.
In April 2023, Binance had its Australian financial services license revoked after ASIC launched a review of Binance Australia Derivatives. Following the decision to revoke the company's license, massive searches were conducted at the company's offices in Australia.
In addition, Binance's banking partners in Australia have terminated their agreements with the cryptocurrency exchange.
It is worth noting that ASIC has paid a total of more than $17.4 million in compensation to more than 2,000 retail clients affected by breaches of financial services laws by eight issuers of retail OTC derivatives.
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