Binance Australia Derivatives sent an abrupt message to a select group of users on Feb. 23, saying it would be immediately closing their accounts due to a false classification of some users as \u201cwholesale clients.\u201d\u00a0<\/p>\n
This incident caused a flurry of responses from users on social media, and the next day, the Australian Securities and Investments Commission(ASIC) announced it would be conducting a \u201ctargeted review\u201d of Binance’s local derivatives operations.<\/p>\n
According to a statement from a spokesperson of the regulator on Feb. 24, the review of Binance Australia Derivatives will include the company\u2019s \u201cclassification of retail clients and wholesale clients.”<\/p>\n
The spokesperson added:<\/p>\n
\u201cIt has not yet reported these matters to ASIC in accordance with its obligations under its Australian financial services license.\u201d<\/p><\/blockquote>\n
However, the spokesperson said the regulator \u201cis aware of Binance\u2019s social media posts,\u201d which were made shortly after users began posting screenshots of the notices on Twitter.\u00a0<\/p>\n
Binance took to social media to clarify the incident, saying that it closed derivatives positions and accounts for some users who they incorrectly classified as \u201cwholesale clients.\u201d Currently the platform is only available to wholesale investors.\u00a0<\/p>\n