Crypto exchange Binance stops selling stock tokens
The crypto exchange announced that it is winding down support for stock tokens on Binance.com to shift its commercial focus to other product offerings.
Mon, 19 Jul 2021, 05:32 am UTC
Crypto exchange Binance is no longer offering stock tokens or crypto assets tied to the value of the shares of certain companies such as Apple, Coinbase, and Tesla. The move came as the company faces increasing scrutiny and actions from various regulators.
In a blog post on Friday, Binance announced that it is ending support for stock tokens. The crypto exchange offered these tokens via a partnership with Germany-based licensed investment firm CM-Equity AG, which held the company shares backing the crypto assets, according to CNBC.
The crypto exchange said that it will no longer sell stock tokens on its website effective immediately. It will also cease support for the crypto assets after October 14.
“Today, we are announcing that we will be winding down support for stock tokens on Binance.com to shift our commercial focus to other product offerings,” Binance announced. “Effective immediately, stock tokens are unavailable for purchase on Binance.com, and Binance.com will no longer support any stock tokens after 2021-10-14 19:55 (UTC).”
Holders of stock tokens may opt to continue holding to their crypto assets or sell them over the next 90 days. However, Binance reminded that they will no longer sell or close their positions after October 14 at 13:30 UTC. All positions on Binance.com will be closed on October 15 at 13:30 UTC.
Binance users who live in the European Economic Area (EEA) and Switzerland have the option to transfer their holdings to a new portal that will be created by CM-Equity AG. The crypto exchange expects the portal to be operational two-to-four weeks before October 15. However, CM-Equity AG might require additional KYC measures to complete the process.
The stock token service was introduced in April that initially allowed investors to buy fractions of shares in Tesla, according to Coindesk. Binance later added stock tokens for Coinbase, MicroStrategy Microsoft, and Apple shares.
However, Germany’s financial regulator warned investors in April that Binance’s stock tokens offering had likely violated securities rules. The U.K.’s Financial Conduct Authority soon followed suit and started to investigate the crypto platform’s stock token offerings. Regulators in Canada, Italy, Japan, and Thailand have also issued warnings about Binance.
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