X

This is why Binance ended stock token sales abruptly

This is why Binance stopped stock token sales – Binance’s highly popular stock tokens, a relatively recent offering, are being wound down immediately. In an announcement published on Friday, the exchange announced that “effective immediately,” stock tokens are unavailable for purchase on Binance.com. As of October 14, 2021, at 7:55 pm UTC, the exchange will no longer support stock tokens at all.

Existing stock token holders will have some time to adjust:

“Users who currently hold stock tokens may sell or hold them over the next 90 days. Users will no longer be able to manually sell or close their positions after 2021-10-14 19:55 (UTC). Thereafter all stock token positions on Binance.com will be closed at 2021-10-15 13:30 (UTC).”

While unconfirmed as of the time of writing, Walter Bloomberg has claimed in a tweet that:

If true, the development would confirm that mounting regulatory pressure on the world’s largest cryptocurrency platform is continuing to hit its operations hard.

In late April, there had already been reports that European and British regulators were scrutinizing Binance’s offering of stock tokens — which represent fractions of equity shares in firms such as Tesla and Coinbase — for possible non-compliance with securities laws. While initially not commenting on Binance in particular, Germany’s Federal Financial Supervisory Authority (BaFin) went on record at the time, stating that:

“Fundamentally […] the following applies: if tokens are transferable, can be traded at a crypto exchange and are equipped with economic entitlements like dividends or cash settlements, they represent securities and are subject to the obligation to publish a prospectus.”

BaFin soon mentioned Binance explicitly, noting its absence of published prospectuses for the stock tokens.

Spring and summer of 2021 have been difficult for Binance on the regulatory front, with multiple countries taking action against it or reportedly investigating its operations from various compliance perspectives.

In the United Kingdom, the Financial Conduct Authority ordered the exchange to halt all “regulated activity” in the country in June. That same month, Japan’s Financial Services Agency accused Binance of operating in the country without proper registration, and new measures against crypto exchanges in the Canadian province of Ontario prompted the exchange to cease all its operations there.

This post was last modified on July 16, 2021 5:04 PM

Categories: Cryptocurrency
Tags: Binance
Tosan Olajide:
X

Headline

You can control the ways in which we improve and personalize your experience. Please choose whether you wish to allow the following:

Privacy Settings