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Binance’s Tesla Token May Raise Regulatory Red Flags

Binance’s Tesla Token May Raise Regulatory Red Flags



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  1. TLDR: Binance’s marketing campaign for its security token representing Tesla stocks to citizens in Hong Kong may be a violation of local securities regulations, according to a prominent local news outlet.

    Inducing members of the Hong Kong public to purchase securities is a regulated activity that requires a license from the city’s top financial watchdog the Securities and Futures Commission (SFC), Gaven Cheong, a partner at law firm Simmons & Simmons [told ](https://www.scmp.com/business/banking-finance/article/3130489/binances-marketing-security-token-based-tesla-stocks)the South China Morning Post on Wednesday. Binance does not appear to have secured a license to market or trade security tokens in the region, according to the report.  

  2. tldr; Binance may need a license to market security tokens to the Hong Kong public, according to a report. Inducing members of the public to purchase securities is a regulated activity that requires a license from the city’s top financial watchdog the Securities and Futures Commission (SFC). Binance does not appear to have secured a license.

    *This summary is auto generated by a bot and not meant to replace reading the original article. As always, DYOR.*

  3. Another concerning detail: “The underlying stocks are in the custody of a third-party brokerage company, according to Binance’s website. It is unclear which brokerage firm is the custodian and where it is located.”

  4. To be Honest they wont have any issues getting a license and their silence on the matter is probably due to wanting to announce the problem is sorted before they have to announce there is in fact a problem.

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