Australia's securities regulator, the Australian Securities and Investments Commission (ASIC), has initiated a "targeted review" of Binance, the world's largest cryptocurrency exchange.
What Happened: The review focuses on Binance's local derivatives business, including its "classification of retail clients and wholesale clients."
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A Binance representative confirmed the exchange closed the derivatives positions of some Australian users who were incorrectly classified as wholesale investors, affecting 500 users, Bloomberg reported.
The company would compensate the affected customers for any losses incurred.
While Binance tweeted about the closure, the ASIC said Binance had not yet reported the matter to the regulator as required by its Australian financial services license.
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However, a Binance spokesperson said the exchange was "committed" to following all relevant Australian laws.
Why It Matters: Binance had been under increasing scrutiny as regulators worldwide ramp up their scrutiny of the crypto industry following the collapse of the FTX exchange last year.
Binance's global business and its U.S. platform are currently subject to multiple regulatory investigations.
In response to the ASIC's review, Binance CEO Changpeng "CZ" Zhao said the exchange would "review the situation and see if/when we can re-open futures offerings in Australia," adding "please ignore FUD," which refers to "fear, uncertainty and doubt" in the crypto industry.
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