Binance is facing more regulatory pressure after an Australian court ordered its local derivatives unit to pay a A$10 million penalty.
The ruling came after the Australian Securities and Investments Commission (ASIC) found that Binance Australia Derivatives wrongly classified hundreds of retail users as wholesale investors. In total, 524 clients were misclassified between July 2022 and April 2023—giving them access to high-risk crypto derivatives without proper protections.
ASIC said this was a serious failure. Retail investors are supposed to have stricter safeguards, but Binance’s system allowed users to bypass checks. For example, some clients could retake qualification quizzes as many times as they wanted until they passed.
The result? Those affected clients lost about A$8.66 million in trading and paid nearly A$3.89 million in fees.
The penalty adds to an earlier A$13.1 million that Binance already paid in compensation to impacted users in 2023. The court also ordered the company to cover part of ASIC’s legal costs.
Joe Longo said the company failed to put basic compliance systems in place, allowing hundreds of people to access complex financial products they shouldn’t have qualified for.
Binance said it had identified the issue itself, reported it to regulators, and fixed the problem in 2023.
Still, this is part of a broader trend. Binance is facing increasing scrutiny across the region. In the Philippines, regulators have already taken steps to limit access to the platform, including blocking its website for many users and removing the app from the Google Play Store.
In simple terms, regulators are tightening the rules—and Binance is now being pushed to prove it can meet them.
