Binance, the world's largest crypto exchange, is set to delist EUR, GBP and AUD trading pairs from margin trading.
Binance noted that “in the event of extreme price movement, your entire margin balance may be liquidated.”
Despite an intensifying regulatory crackdown, cryptocurrency exchanges throughout the globe Support for several of Binance's trading services is still restricted.
Binance stated on Monday that three fiat currencies would be delisted from its margin trading pairs: the euro, the Australian dollar, and the British pound sterling.
Binance will stop the mentioned fiat trading pairs on August 10 and subsequently switch to automatic settlement and cancel any connected pending orders, according to the release. By August 12th, the exchange will have completely delisted the isolated margin trading pairs.
Binance's proactive attempts to reduce trading risks are reflected in the current trading restriction, as well as its recent move to drastically limit leverage trading on Binance Futures, maximum leverage holdings will be reduced from 125x to 20x.
“Margin trading carries a high level of risk, as well as the prospective for huge profits and losses. Past performance does not guarantee future results. “In the event of significant price volatility, your whole margin amount may be liquidated,” the notification warns.
Margin trading is a way of trading cryptocurrencies that involves borrowing funds and allows traders to leverage their positions with more capital. Binance's margin trading service, similar to Binance Futures, was launched in July 2019.
The exchange allows customers to open a position with their own money and the quantity of assets they wish to buy by automatically lending them the funds they need to open a position with the highest possible leverage. When a position is closed, the exchange automatically deducts the payback amount as well as other fees.
The disclosure comes as Binance has recently come under heightened scrutiny from international regulators and financial organisations. The exchange has been cautioned by authorities in the United States, the United Kingdom, Italy, and other nations. Since late June, a number of British banking institutions, including Barclays and NatWest bank, have begun restricting payments to Binance.
According to a Financial Times report published on Sunday, some crypto funds have withdrawn from trading on Binance as a result of the escalating regulatory crackdown on the exchange, with crypto-focused investment firm Tyr Capital and fellow hedge fund ARK36 decreasing their exposure to Binance. The global regulatory resistance and uncertainty, according to ARK36's executive director Ulrik Lykke, "should raise warning signals for anyone maintaining real wealth at the exchange."
