US cryptocurrency exchange Binance announced yesterday (September 5) that it will cease some of its products and offerings in Singapore, in compliance with local regulations.
Binance said on its website yesterday that all of its trading pairs and payment options in Singapore dollar (SGD) will be ceased this Friday (September 10) by 12 PM UTC+8. Its mobile app will also be removed from the Apple App store and Google Play store in Singapore by Friday.
The exchange advised all users to complete all SGD-related peer-to-peer (P2P) trades and remove all associated trade advertisements by noon this Thursday (9 September) to avoid possible trading disputes. This advice follows an announcement that Binance P2P will remove all SGD trading pairs by noon this Friday.
“Binance welcomes developments to our industry’s regulatory framework as they pose opportunities for the market players to have greater collaboration with the regulators. We are committed to working constructively in policy-making that seeks to benefit every user,” said Binance.com in media statement.
Binance faces scrutiny from regulators worldwide
Financial authorities worldwide have been cracking down on Binance for failure to comply with local regulations, including the unlicensed provision of exchange services.
The latest country to join in the upheaval is South Africa, whose financial regulator issued a warning to its citizens last Friday (3 September), stating that Binance does not have the authorisation to operate in the country.
Earlier on September 2, the Monetary Authority of Singapore (MAS) ordered Binance to halt its payment services to Singapore residents, citing a breach of the Payment Services Act.
Following the ban, Binance.com has since been placed on MAS’ Investor Alert List.
This clampdown only affects Binance.com. Users of the separate Singapore entity, Binance.sg, will not be seeing any service changes.
Binance Asia Services, the operator of Binance.sg, has submitted a licence application, which is currently under review by MAS. As such, Binance.sg is exempted from holding a licence for the provision of digital payment token services while the approval is being processed.
How will Binance’s exit from futures and derivatives impact the market?
The increased scrutiny has also forced Binance to exit its futures and derivatives business in Europe, along with other moves by the platform to whittle down on its products and offerings as regulators around the world follow suit.
Binance US — just like Binance.sg, operates as a separate legal entity as the global exchange Binance.com — bore most of the blow from the recent regulatory backlash.
For instance, the US exchange saw investors backing out of its latest US$100 million funding round. As a result, Binance US CEO Brian Brooks tendered his resignation after just three months into the job.
However, Binance.com still ranks among the largest crypto exchangers in the world. According to CoinMarketCap, Binance saw trade volumes of over US$26 billion as of today, ranking it the top cryptocurrency exchange by volume.
The medium-term impact of Binance’s retreat from these sections of the crypto derivatives market still remains to be seen.
Featured Image Credit: Bloomberg