Binance’s highly popular stock tokens, a relatively recent offering, are being liquidated immediately. In an announcement posted on Friday, the exchange announced that “effective immediately”, the stock tokens are not available for purchase on Binance.com. As of October 14, 2021, at 7:55 pm UTC, the exchange will no longer support security tokens at all.
Existing share token holders will have some time to adjust:
“Users who currently have share tokens can sell or hold them for the next 90 days. Users will no longer be able to sell or manually close their positions after 2021-10-14 19:55 (UTC). Thereafter, all Stock token positions on Binance.com will close at 2021-10-15 13:30 (UTC). ”
Although unconfirmed as of this writing, Walter Bloomberg has stated in a tweet that:
HONG KONG’S SFC SAYS NO ENTITY IN THE BINANCE GROUP IS LICENSED OR REGISTERED TO CONDUCT “REGULATED ACTIVITY” IN HONG KONG
— *Walter Bloomberg (@DeItaone) July 16, 2021
“THE HONG KONG SFC SAYS THAT NO ENTITY IN THE BINANCE GROUP IS AUTHORIZED OR REGISTERED TO CARRY OUT A” REGULATED ACTIVITY “IN HONG KONG”
If true, the fact would confirm that mounting regulatory pressure on the world’s largest cryptocurrency platform continues to hit its operations hard.
At the end of April, It had already been reported that European and British regulators were examining Binance’s share token offering -which represent fractions of shares of companies like Tesla and Coinbase- for possible breach of securities laws. Although it did not initially comment on Binance in particular, Germany’s Federal Financial Supervisory Authority (BaFin) took the record at the time, stating that:
“Fundamentally […] The following applies: if the tokens are transferable, they can be exchanged on a crypto exchange and are endowed with economic rights such as 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 share tokens.
The spring and summer of 2021 have been difficult for Binance on the regulatory front, with several countries taking action against it or investigating its operations from various compliance perspectives.
In the United Kingdom, the Financial Conduct Authority ordered the exchange to halt all “regulated activities” 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 led the exchange to cease all operations there.