Binance will no longer provide digital versions of shares such as Tesla, Apple, and Coinbase because the cryptocurrency exchange is facing increasing pressure from regulators around the world.
The world’s most traded digital currency exchange said in a blog post on Friday that it will end support for “stock tokens,” which are crypto-assets linked to the value of certain stocks.
Binance provides tokens through a partnership with CMEquity AG, a licensed investment company headquartered in Germany. According to Binance, each token is fully backed by CMEquity AG stock.
Binance stated that it was unable to purchase stock tokens on its website, “effective immediately.” The company will stop supporting stock tokens after October 14. Users can sell or keep them for the next 90 days.
European users will be able to move their holdings over to a new “portal” from CM-Equity AG roughly two to four weeks before Binance closes all positions on Oct. 15, Binance said. The company said the decision was taken to “shift our commercial focus to other product offerings.”
In April, Germany’s financial watchdog warned investors that Binance had likely violated securities rules with the launch of its stock tokens, adding the company faced potential fines for not publishing investor prospectuses for the instruments.
“As the crypto ecosystem evolves, and as Binance grows as a company, we are continually evaluating our products and working with our partners to meet our users’ needs,” a Binance spokesperson told CNBC. “We take our legal obligations very seriously and engage with regulators and law enforcement in a collaborative fashion. We don’t comment on specific matters or inquiries.”