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ASIC takes legal action against Binance for consumer protection violations

ASIC lawsuits against Binance Australia: ASIC claims that Binance misclassified about 83% of its retail investors as wholesale clients, leaving them vulnerable to HIGH-risk crypto products. This misclassification affected approximately 505 investors, stripping them of essential consumer protections.

Financial repercussions for affected clients: In 2023, ASIC oversaw compensation payments totaling around 13 million USD to impacted customers of Binance. The lack of product disclosures and dispute resolutions was a key problem that led to significant financial losses for many clients.

Regulatory scrutiny and compliance issues: ASIC expressed concerns about Binance’s inadequate compliance systems and staff training. This lawsuit follows the cancellation of Binance’s financial services license in April 2023, indicating ongoing regulatory scrutiny in the cryptocurrency market.

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