Binance is winding down its futures and derivatives products offerings across Europe under pressure from financial regulators in several countries.
Today Binance announced on its website about winding down its derivatives products offerings across the Europe region commencing with the Netherlands, Germany, and Italy.
With immediate effect, users from these countries will not be able to open new futures or derivatives products accounts.
With effect from a later date to be announced in a further notice, users from these countries will have 90 days to close their open positions.
Binance said on Twitter that Europe is a very important market for it, and it is “taking steps towards harmonizing crypto regulations” marking a positive sign for the industry.
Regulatory issues at a glance
For several weeks Binance has been facing the heat from financial regulators and has been under scanner specifically for its organizational structure which has created ambiguity about its legal status.
It is difficult to ascertain where its parent company is based and, due to the puzzling status of cryptocurrencies with different interpretations, Binance is being prosecuted for operating a financial company without the appropriate license(s) in many countries.
More than 10 countries have served notices to Binance for contravention of various laws.
Binance has maintained that it is a decentralized organization with a local subsidiary in every country it operates under the umbrella organization.
Recent attempts at improving compliance
Under the mounting pressure, on Monday Binance announced that it would stop offering margin trading involving the Australian Dollar, euro, and Sterling.
Earlier this month it stopped selling digital tokens linked to stocks, after regulators cracked down on the cryptocurrency “stock tokens” offerings, digital versions of stocks like Tesla, Apple, and Coinbase.
In a recent press conference Binance CEO Changpeng Zhao had said that Binance is open to regulation and is “pivoting from a tech startup to a financial institution.”
New technology always needs a new policy. A global see-saw game is being played by crypto entrepreneurs and regulators wherein regulators are engaged in trial and error to find the policy which strikes the right balance between restriction and allowance.