Binance quits stock token trading as Hong Kong increases regulatory pressure – Bitcoin exchanges news

The Binance cryptocurrency exchange has announced that it will no longer support trading of stock tokens. The move comes amid an ongoing regulatory crackdown, with Hong Kong becoming the latest to declare that the platform is not authorized to provide such services in its jurisdiction.

Stock tokens are no longer available for purchase on Binance.com

Binance, the world’s first digital asset exchange by daily volume, is discontinuing support for stock tokens. The coin trading platform explained that the move is part of its ongoing product evaluation, but it also comes amid increasing pressure on the exchange from regulators around the world. On Friday, the crypto firm said:

Today we are announcing that we will end support for exchange tokens on Binance.com in order to shift our trading focus to other product offerings.

The exchange stressed that the suspension is “effective immediately,” with stock tokens already unavailable for purchase on Binance.com. The platform will not support any stock tokens after October 14, 2021, but investors will be able to hold and sell them for the next 90 days.

The announcement further details that “all stock token positions on Binance.com will be closed on October 15, 2021 at 1:30 p.m. (UTC)”. Binance said the closing prices will be based on the actual executed prices after the market opens on October 15. He warned that these could be different from the rates recorded a day earlier. A Binance spokesperson was quoted by the Wall Street Journal as saying:

We believe that by shifting our business focus to other product offerings, we will better serve our users in the long run.

Residents of the European Economic Area (EEA) and Switzerland will have the option to transfer their exchange tokens to a new portal which will be launched by CM-Equity AG in early October. The transition will be subject to additional Know Your Customer (KYC) procedures, Binance added, noting that all exchange tokens listed on Binance.com are products issued and sold by Germany-based CM-Equity.

Hong Kong Securities Commission warns against purchases of stock tokens on Binance

Binance’s move coincides with a growing number of regulators voicing concerns about the exchange offering token shares among other products and services without authorization. The list includes regulators in Italy, Lithuania, the UK, Japan and Germany, where the Federal Financial Supervisory Authority, Bafin, said earlier this year that tokens tied to shares of companies like Tesla represent securities, if they can be transferred and traded on a cryptocurrency exchange.

Hong Kong’s Securities and Futures Commission (SFC) has become the latest agency to issue a warning against Binance. On Friday, the regulator said it was “aware that Binance has offered exchange token trading services in a number of jurisdictions and is concerned that these services may also be offered to investors in Hong Kong.” The SFC pointed out that “no entity of the Binance group is authorized or registered to conduct” regulated activity “in Hong Kong.”

The commission clarified that the stock tokens are likely to be “securities” under the Securities and Futures Ordinance of the China Special Administrative Region. And if so, they should be subject to the regulatory jurisdiction of the SFC.

The regulator warned that the marketing and distribution of such tokens, “whether in Hong Kong or targeting Hong Kong investors”, constitutes “regulated activity” and requires a license. Anyone offering stock tokens in the city without registration can face criminal prosecution, the securities commission said, urging potential investors to be “extremely careful” with purchases of stock tokens on platforms. not regulated.

What do you think of the current regulatory pressure on the Binance crypto exchange? Tell us in the comments section below.

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