REUTERS/Darrin Zammit Lupi
- Binance said users in South Africa will no longer be permitted to trade derivatives, effective immediately.
- Binance will cease offering futures, options, margin, and leveraged trading.
- Users have until January 6 to reduce and close their positions while new users will be restricted from opening new accounts.
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Cryptocurrency exchange Binance announced Friday that users of its platform in South Africa will no longer be permitted to trade derivatives, effective immediately, in compliance with local regulations.
The world's largest cryptocurrency exchange said in a blog post that it will cease offering futures, options, margin, and leveraged trading. Users will have until January 6 to reduce and close their positions, while new users will be restricted from opening new accounts.
The move might be seen as a loss for the region's burgeoning cryptocurrency ecosystem. Africa's digital-asset market has grown over 1,200% by value over the last year, making it the third-fastest growing cryptocurrency economy in the world, a recent Chainalysis report showed. That's as users seek out cheaper and faster ways to transfer money at home and abroad.
But Binance's decision Friday comes amid heightened scrutiny from global regulators over numerous concerns, such as cryptocurrencies being used in money laundering. South Africa has joined the UK, Australia, Thailand, Germany, Canada, Japan, and Italy, among others, who have issued bans and warnings to the exchange.
Binance also announced September 29 its main platform in Singapore will no longer be permitted to buy and sell cryptocurrencies beginning October 26.
After having no formal headquarters since its founding in 2017, Binance finally admitted in September it needs a centralized headquarters to work well with regulators all over the world.