Australia's Federal Court has ordered Oztures Trading Pty Ltd — which operated as Binance Australia Derivatives — to pay an AUD $10 million (~$6.9M USD) penalty for exposing retail investors to high-risk crypto derivative products they were never eligible to access.

The Quiz Exploit

The misclassification occurred between July 2022 and April 2023. Rather than enforcing a one-shot eligibility test, Binance allowed users unlimited retakes of a multiple-choice quiz designed to identify sophisticated investors. Users who failed could keep trying until they passed. Of the 524 misclassified clients, 460 were approved through this quiz, while others were rubber-stamped on the basis of unverified claims — including one person approved as a "professional investor" solely on their unverified assertion of being an "exempt public authority."

The Damage

The 524 misclassified retail investors incurred AUD $8.66 million (~$6M USD) in trading losses and paid AUD $3.89 million ($2.67M) in fees on products they legally should have been blocked from. ASIC Chair Joe Longo noted that Binance's failures left more than 85% of its Australian customer base exposed to wholesale products without the consumer protections they were entitled to.

Binance had self-identified the issue and paid approximately AUD $13.1 million in compensation to affected users back in 2023. The court's penalty now adds to that, and the entity has since voluntarily surrendered its Australian Financial Services License.

Regulatory Context

The case arrives as Australian regulators continue to press exchanges on compliance. ASIC's action signals that self-remediation — while considered — does not shield exchanges from court-ordered penalties when onboarding failures are systematic.