Binance Exploits MiCA Loophole Amid EU Regulatory Pressure

Binance's relationship with European regulators has become increasingly complex after missing the July 1 deadline to secure a Markets in Crypto-Assets (MiCA) license.

The exchange pulled its application in Greece weeks earlier, but it hasn't fully exited the EU market. Binance is leaning on a regulatory exemption called reverse solicitation and routing some EU trading through an Abu Dhabi entity.

Regulators, including ESMA, are asking questions about whether Binance's wind-down is happening as required. MiCA requires any crypto asset service provider operating in the EU to hold authorization from a regulator in at least one member state.

Binance continues serving some EU customers, with commercial data showing it still controls more than 45% of global spot crypto trading volume in late August.