As of August 2, French Binance customers will no longer be able to use certain trading products.
From August 2, the giant Binance will no longer allow its customers to carry out certain trading operations. The company sent an email to its French users on Wednesday informing them of the news.
“As Binance constantly reevaluates its product and service offerings to comply with local regulations, we will be making changes to the following products for users residing in France: Futures, Options, Leveraged Tokens, Binance Earnings (Dual Investment),” Binance explained.
Indeed, from August 2, French users will no longer be able to “increase (their) positions in these products or open new positions”. They will be able to “fill their margin balances to avoid margin calls and liquidations, or buy, reduce and close any of their existing positions,” Binance adds.
“These are very complex financial instruments used by advanced or technical investors. Investors, corporations and governments use derivatives such as forwards or futures to hedge their exposure to asset price risk and volatility,” Binance wrote on its blog to qualify futures contracts.
Contacted by BFM Crypto, a member of Binance France confirmed that the company will make changes to certain products for users residing in France.
“We actively and continuously review our product offerings and operations, based on user demand, changing regulatory standards and future opportunities, to determine changes and improvements,” explained a spokesperson from Binance.
“We are fully committed to the development of our industry and our priority is to satisfy our users by complying with local regulations”, he added.
Why did the cryptocurrency giant make such a decision? In early May, Binance received registration as a digital asset service provider (PSAN), becoming the 37th player to receive one from the Autorité des marchés financiers (AMF). In its communication, Binance explains that it takes such measures to adapt to French regulations. Indeed, the sale of derivative products (including crypto-assets as underlying) requires an authorization as an Investment Service Provider (ISP), which PSAN registration alone does not allow.
Until now, Binance, which claims 120 million subscribers, has never communicated the number of its French subscribers. It is therefore difficult to know how many French people are currently affected by this measure.
What are the consequences?
As a result, leveraged traders will turn to other platforms. Additionally, by shutting down some services, Binance will generate less revenue.
For the founder of niche site Coin Academy, Binance’s decision could have an impact on other PSAN players.