Leading crypto exchange Binance has announced that customers would no longer be able to purchase stock tokens on its platform, effective immediately.
The latest move comes in a spate of increased scrutiny from regulators across the globe. Although Binance claims that the decision was necessary to allow it to concentrate on other products and services, the development may not be unconnected to several backlashes the crypto exchange had received from regulators regarding the product.
As reported by BTC PEERS, Germany’s Federal Financial Supervisory Authority (BaFin) frowned heavily at the product, stating that it had “reasonable grounds” to believe that Binance violated the country’s securities laws in launching its stock tokens offering.
Since then, several other regulatory bodies have moved to warn citizens about the operations of Binance, with many claiming that the exchange is operating illegally.
Stock tokens were introduced by Binance in April, to allow customers to buy portions of shares in companies, beginning with Tesla (NASDAQ:TSLA) and shortly followed by Coinbase before Microsoft (NASDAQ:MSFT) & Apple (NASDAQ:AAPL) followed suit.
According to the announcement, Binance will no longer support any stock tokens after 7:55 pm UTC on October 14th, 2021. Current stock tokens holders have been advised to sell their assets before the said date.
Users who currently hold stock tokens may sell or hold them over the next 90 days. Users will no longer be able to manually sell or close their positions after 2021-10-14 19:55 (UTC). Thereafter all stock token positions on Binance.com will be closed at 2021-10-15 13:30 (UTC).There are also additional options for stock token holders in the European Economic Area (EEA) to transfer their portion to CM-Equity AG. A portal for this purpose is currently in development.