SFC Warns Binance is Not Licensed in Hong Kong

Another warning against Binance, this time issued by Hong Kong’s Securities and Futures Commission (SFC) on Friday.

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According to the city's regulator, it is aware that the firm has offered trading services in stock tokens in a number of jurisdictions and is concerned that such services may also be offered to investors in Hong Kong.

The regulator then confirmed that Binance does not have any licensed or registered entity in Hong Kong.

Stock tokens are being pushed as a way for investors to acquire fractional shares rather than the complete fully paid-up shares since they may be priced in fractional units.

Stock tokens are likely to be classified as "securities" under the Securities and Futures Ordinance (SFO) in Hong Kong, and if so, they are subject to the SFC's regulatory oversight. Where the stock tokens are "securities," the SFC advises that selling and/or distributing them, whether in Hong Kong or to Hong Kong investors, is deemed a regulated activity that requires a license from the SFC unless otherwise stipulated.

Any person who contravenes a relevant provision may be prosecuted and, if convicted, subject to criminal sanctions.

Complaints have been filed with SFC by investors who experienced difficulties withdrawing funds from their accounts opened with unregulated platforms. Furthermore, investors should be aware that if such platforms have no ties to Hong Kong, the SFC may not have authority over them. Obtaining redress in the event of a disagreement is likely to be difficult, and legal remedies may be unavailable.

Just recently, Fazzaco reported that the Central Bank of Lithuania​ announced that Binance is not authorized to operate in Lithuania.