Binance closes futures also in Hong Kong
Binance closes futures also in Hong Kong
Regulation

Binance closes futures also in Hong Kong

By Marco Cavicchioli - 6 Aug 2021

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Binance has officially announced that it will close the possibility of using derivative products, such as futures, to customers in Hong Kong.

A few days ago, it had already done something similar for Germany, Italy and the Netherlands, following a warning from the Italian Financial Markets Authority.

The exchange reports that Hong Kong users will no longer be able to open new derivatives accounts with immediate effect, and will have 90 days from a date to be announced to close all of their outstanding derivatives positions.

The official announcement reads:

“We will restrict Hong Kong users with respect to derivatives products (including all futures, options, margin products and leveraged tokens) in line with our commitment to compliance.”

According to the announcement, Binance would be the first major crypto exchange to proactively restrict access to derivatives products to Hong Kong users.

As a result, the exchange is withdrawing its offerings of regulated products in certain countries in order not to violate any regulations in the countries where it operates, unless it is authorised to offer them to customers in those countries. However, it cannot be ruled out that it may obtain the necessary authorisations in the future and reopen these services.

Binance’s choice of futures and derivatives

A curious thing, however, is that these initiatives are all very recent and follow the warning issued by the Italian Consob, whereas the first report of Binance Futures was made by the Brazilian CVM in July last year, and then taken up the following month by the same Consob.

Binance probably must have underestimated the importance of those reports, especially because if no action is taken after a warning of this type, sooner or later the warning is automatically triggered. Perhaps the company decided to wait for the warning in order to understand how seriously the Consob was taking it, but in these cases the governmental agencies of vigilance on the financial markets are always serious.

If nothing else, however, the exchange shows a clear desire to operate within the law, as it appears willing to give up a significant chunk of its revenues in these countries in order to comply with the regulations, or at least stop operating without the necessary authorisations.

In light of this, it is possible to imagine that in the future it could take similar initiatives in other countries as well, until it manages to obtain all the necessary authorisations to be able to offer these regulated products in accordance with the law.

It should be remembered that Binance is only four years old, and it may take a while to obtain all of them.

 

Marco Cavicchioli

Born in 1975, Marco has been the first to talk about Bitcoin on YouTube in Italy. He founded ilBitcoin.news and the Facebook group" Bitcoin Italia (open and without scam) ".

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