Binance Australia Offices Searched by Regulator as Part of Derivatives Probe

Australia’s financial markets regulator searched Binance’s offices in an ongoing probe of the crypto exchange’s now-defunct local derivatives business, according to people familiar with the matter.

Australian Securities and Investments Commission, the nation’s integrated corporate, markets, financial services and consumer credit regulator, conducted searches at BINANCE Australia locations on Tuesday, the people said, asking not to be identified discussing private information.

ASIC’s review of the derivatives operation includes Binance Australia’s classification of retail and wholesale clients. The company said in April it would wind down the local derivatives exchange while keeping the spot platform open. The firm previously said it had the derivatives positions of some Australian users because they were incorrectly classed as wholesale investors.

A spokesperson for ASIC, which in April canceled Binance Australia’s license for its derivatives operation, said “we are unable to confirm or deny any operational detail such as possible searches” and added that the regulator’s review of the company “is ongoing.”

Binance said that it’s “cooperating with local authorities” and “is focused on meeting local regulatory standards in order to serve our users in Australia in a fully compliant manner.”

Binance, the world’s largest crypto exchange, faces a web of probes around the globe and has been dropped by some payments providers wary of regulatory fallout. Its Australia platform has been from a key local currency withdrawal route.

Last month, authorities in France visited Binance there. French officials are investigating the alleged illegal provision of digital-asset services and acts of aggravated money laundering. Binance has said it abides by all laws in France and in every other market where it operates.

US Securities & Exchange Commission in June accused Binance and its founder Changpeng ‘CZ’ Zhao of mishandling customer funds, misleading investors and regulators, and breaking securities rules. 

Binance has called the SEC action “disappointing” and said that it intends to defend its platform “vigorously.” Zhao and Binance also face a lawsuit from the Commodity Futures Trading Commission

— With assistance by Sidhartha Shukla