Australia’s Federal Court has ordered Binance Australia Derivatives to pay A$10 million after the exchange admitted to exposing more than 85% of its Australian customer base to high-risk crypto derivatives they were never qualified to access.
The affected investors, 524 retail clients, were misclassified as wholesale clients between July 2022 and April 2023, granting them access to complex derivative products without the consumer protections Australian law requires.
The misclassification led to A$8.66 million in trading losses and A$3.89 million in fees.
One detail stands out. Binance admitted that users seeking sophisticated investor status could retake a multiple-choice qualification test an unlimited number of times until they achieved a passing score. Senior compliance staff also failed to adequately review client applications or supporting documents.
ASIC Chair Joe Longo did not hold back.
“This wasn’t just a technical breach – it directly resulted in over $12 million in client losses,” he said. “Binance failed to set up basic compliance checks and incorrectly approved hundreds of applications for complex, wholesale investor products.”
Binance’s response was measured. “The issue was self-identified, reported to ASIC, and fully remediated in 2023,” a spokesperson said, adding that Oztures had voluntarily surrendered its Australian financial services licenses that same year.
The fine comes on top of approximately A$13.1 million already paid in compensation to affected clients in 2023. Justice Moshinsky also ordered Binance to cover ASIC’s legal costs.
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The Australia ruling is the latest in a string of regulatory confrontations for the world’s largest crypto exchange. In 2023, Binance pleaded guilty to violating US anti-money laundering and sanctions laws, paying a record $4.3 billion penalty. Founder Changpeng Zhao served a short prison sentence before being pardoned by President Trump in October 2025.
This year alone, the US Senate opened a formal probe into allegations that $1.7 billion in crypto flowed to Iran-linked entities through the platform. The DOJ launched its own investigation. Binance denied direct transactions with Iranian entities and sued the Wall Street Journal for defamation over its reporting.
Each time, the exchange points to its compliance improvements. Each time, a new jurisdiction adds its name to the list.
Binance misclassified 524 retail clients as wholesale investors, exposing them to high-risk derivatives without required protections, causing over A$12 million in combined losses and fees.
Wholesale clients get fewer legal protections. Binance wrongly labelled everyday retail investors as sophisticated, giving them access to complex products they were never qualified for.
Binance paid approximately A$13.1 million in compensation to affected clients in 2023, before the court-ordered A$10 million fine was handed down separately.
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