Binance is the largest cryptocurrency exchange platform in the world by trading volume. However, the exchange giant has been facing issues with regulatory bodies in many countries at present. Binance has recently decided to halt the tokenized stock services recently. The tokenized stocks are a comparatively new service launched by Binance only three months ago.
These digital tokens have represented different equity stocks since April. The first public trading company to peg value in these tokens was Tesla. Later on, the equity tokens for names like Coinbase, MicroStrategy, Microsoft, and Apple Inc. were also launched. The first regulator to express reservations about the equity stocks was Financial Services Authority from Germany. Binance management announced on Friday that all stock tokens available on Binance.com would be frozen immediately.
After the recent announcement by Binance, the consumers who still possess their stock tokens are left in a state of shock. According to the Binance declaration, those who still hold these tokens may choose to hold them or sell them within 90 days. As soon as the 90 days period expires, these consumers will be unable to sell their tokens on the open market or close their accounts.
According to Binance, the equity token market will open up for trading once again by 15-10-2021. The exchange further added that German-based CM-Equity AG would launch a new stock token available for the consumers in the European Economic Area and Switzerland.
Hong Kong Regulator Becomes the Latest Financial Watchdog to Penalize Binance Exchange
Among the long list of countries where Binance is facing regulatory backlash, the latest addition is Hong Kong. The Securities and Futures Commission (SFC) has recently issued a public warning against Binance. SFC management claims that Binance does not have legal approval, proper license, or any sort of authorization to offer its services in the region. This warning comes only a few days after Italian regulator CONSOB issued a warning against the exchange platform. More than eight countries, including UK, USA, Cayman Islands, Singapore, Poland, and Japan, have done the same in the span of the last few weeks. It should be noted that Binance operates in many countries with a different set of rules and regulations in every jurisdiction.