Binance Under Fire for EU Exemption Use

The European Securities and Markets Authority (ESMA) is scrutinizing Binance, the world's largest crypto exchange, over its use of the 'reverse solicitation' rule in the EU.

Under MiCA rules, non-EU exchanges cannot offer services to EU users without a valid license. However, Binance claims it is using this rule as an exemption, allowing it to serve millions of EU users despite not having a MiCA license.

The regulators are concerned that Binance is exploiting this loophole, and ESMA has asked unlicensed platforms, including Binance, to prepare plans to wind down their EU operations.

Binance said it remains focused on meeting regulatory requirements across Europe and is working towards becoming MiCA-authorised. If found to have breached MiCA rules, regulators could take enforcement action against the exchange.