Binance said on Friday it had stopped selling digital tokens linked to shares, as Hong Kong’s financial watchdog became the latest in a string of regulators to crack down on the cryptocurrency exchange platform’s “stock tokens” offerings, according to Reuters.
Stock tokens are digital versions of equities pegged to the value of the relevant share. They are usually bought and sold in fractional units, unlike traditional equities.
“Effective immediately, stock tokens are unavailable for purchase on Binance.com,” said Binance on its website, adding it would cease all support for the products in October.
Global scrutiny of the cryptocurrency sector has grown amid worries over lax consumer protection and the use of digital coins for money laundering, with authorities in recent months zeroing in on Binance, one of the world’s biggest platforms.
Hong Kong’s Securities and Futures Commission (SFC) stated on Friday that Binance was not licensed to carry out regulated activities in the city. Offering stock tokens to the Hong Kong public without authorisation could be an offence it added.
“Any person who contravenes a relevant provision may be prosecuted and, if convicted, subject to criminal sanctions,” said the SFC.
Its move came a day after Italian regulators made a similar announcement and it was not immediately clear whether global regulators have coordinated their moves, which have created unprecedented global pressure on a major cryptocurrency firm.
It was offering tokens for companies including Apple Inc, Microsoft Corp and Tesla Inc.
Regulators in Britain, Germany, Japan and some other countries have stepped up warnings over Binance, with the United States also reportedly investigating the exchange.