Binance Will Limit Derivatives Trading For Hong Kong Customers

Binance, of the leading crypto exchanges in the world, intends to limit derivatives trading for all Hong Kong users. More specifically, in order to prevent and minimize any of the unavoidable risks that come with crypto, Binance plans to impose a restriction on derivatives products exclusively. Despite not stating a specific date, Binance looks ready to follow through with this decision.

This news is most likely a result of the repressive actions by the Chinese government against cryptocurrencies in China. From here, it is no wonder why Changpeng Zhao, CEO of Binance, sees this move as a ‘proactive measure for establishing crypto-compliance best practices worldwide’. He further went on by saying:

Users from Hong Kong will have a 90 days grace period to close their open positions. During the grace period, no new positions may be opened. New Binance users from Hong Kong can no longer open futures accounts and we will wind down access for existing users.Zhao Chanpeng | CEO of Binance

Consequently, this is not the first case that puts Binance in the spotlight. In fact, Binance is facing several controversial charges for violation of several different local government rules. One such case is Malaysia. In that case, the SCM (Securities Commission Malaysia) ordered Binance to cease all operations in Malaysia indefinitely. Consequently, that is a result of Binance operating in Malaysia without proper government authorization.

Something similar is going on in Germany as well. More specifically, the Federal Financial Supervisory Authority (BaFin) accuses Binance of selling shares illegally. This was done via ‘share tokens’, and it may result in Binance paying hefty fines. This may seem fit, since just recently Binance stopped offering derivatives trading in Germany, in addition to several European countries such as Italy and Netherlands. The reason for this decision is quite clear. Reduce the risk by cutting high-risk services from the offer. Something that looks quite a lot like the latest situation in Hong Kong.

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