Cryptocurrency exchange Binance announced the termination of trading in tokens-shares, without specifying the reasons for this decision. This is most likely due to regulatory pressure.
In April, Binance added tokenized stock trading for Apple, Microsoft, Tesla, Apple, Coinbase, and Microstrategy, paired with the BUSD stablecoin. Now their purchase on the stock exchange is no longer possible. Users who still own these assets can sell them within 90 days. However, if users do not manage to do this before October 14, 2021, their positions will be automatically closed.
Traders from the European Economic Area (EEA) can transfer their assets to the service of the German financial services provider CM-Equity AG, which will open in late September or early October. To do this, users will have to go through an additional KYC procedure.
“As the cryptocurrency ecosystem evolves, we continually evaluate products that are hosted on the Binance platform. We work with partners to meet the needs of our users. The decision was made to stop trading stock tokens on Binance.com and switch to developing other products, ”Binance said in a statement.
After the placement of tokenized shares on Binance, British and European regulators began to show increased interest in the activities of the exchange, suspecting it of a possible violation of securities laws.
The German Federal Agency for Financial Supervision (BaFin) said that if tokens traded on a cryptocurrency exchange give their owners economic rights (such as receiving dividends), they are securities. In addition, issuers of tokenized shares are required to publish their prospectus.
Despite pressure from regulators, Binance CEO Changpeng Zhao is willing to work with them on any issue. Zhao recently said that the tightening of regulatory requirements for cryptocurrency firms is a sign of the maturation of the industry.
