Largest crypto exchange by trading volume Binance has announced a restriction to crypto derivatives traders in Hong Kong while at the same time giving the users a 90 day period to close open positions.
Binance, a major cryptocurrency exchange, has announced that it will restrict Hong Kong users access to derivatives products in an effort to reduce the inherent risks of trading bitcoin. The official statement says as follows:
“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.”
Binance’s proactive measures to restrict Hong Kong users, however, were not accompanied by a timeline for when the restrictions would be implemented.
Binance CEO Changpeng Zhao explained that the new limits are intended to be a “proactive approach” for creating “crypto compliance best practices worldwide.”
Zhao also summed up recent events in Hong Kong, saying:
“New Binance users from Hong Kong can no longer open futures accounts and we will wind-down access for existing users.”
While Binance’s proactive ban on Hong Kong users may protect new users, the move appears to be more in line with China’s escalating crackdown on cryptocurrency businesses, including exchanges, mining, and token offers.
Binance is still being investigated by regulators in a number of countries for allegedly providing a platform for unlawful trades. Binance is apparently on a mission to stop selling high-risk services in order to keep its doors open for business.
The crypto exchange recently announced that futures trading would be suspended in Europe, beginning with Germany, Italy, and the Netherlands.
The move showed Binance’s proactive measures toward harmonizing crypto rules. The Securities Commission of Malaysia, on the other hand, has requested Binance to cease all operations in the country.
Binance was purportedly functioning in Malaysia despite the government’s refusal to grant it permission.
In addition, Germany’s financial watchdog, the Federal Financial Supervisory Authority, or BaFin, has warned Binance that it might face significant fines if it sells shares in Germany in the form of “share tokens” without providing the required prospectuses.