Binance Faces EU Scrutiny Over Reverse Solicitation Claims

The European Union's MiCA regulation requires cryptocurrency exchanges to obtain authorization before offering services within the EU. Binance, one of the largest exchanges globally, has not yet obtained this authorization but continues to serve some European clients.

Regulators from France, Germany, and Greece are investigating how Binance uses 'reverse solicitation', an exemption allowing a non-EU entity to serve EU investors if they initiated contact. However, ESMA emphasizes that reverse solicitation is a narrow exception and should not be used as a way to circumvent MiCA obligations.

Binance claims compliance with regulatory requirements and is actively working on obtaining the necessary authorization. Until then, the exchange must demonstrate that its services respect the limits of reverse solicitation.