EU Regulators Question Binance Over Unlicensed European Operations

The world's largest cryptocurrency exchange, Binance, is under scrutiny from EU watchdogs for continuing to serve clients in the bloc despite being told to wind down its European business months ago. The company failed to secure a licence under the Markets in Crypto-Assets Regulation (MiCA) this summer and was expected to take immediate steps to wind down its EU operations by 1 July.

Regulators, including the European Securities and Markets Authority (ESMA) and national authorities in countries like France, Germany, and Greece, are examining how Binance uses 'reverse solicitation', a legal exemption that allows companies based outside the EU to serve customers in the bloc as long as those customers seek out the service entirely on their own initiative.

Some regulators have asked Binance for information and could take enforcement action, including fines, if they are not satisfied with its answers. ESMA stressed that the reverse solicitation exemption is 'very narrowly framed' and should be regarded as an exception rather than a way to circumvent MiCA requirements.

Binance's local licences in countries like France, Spain, and Poland lapsed under MiCA, while customers in other EU countries are served by its entity in Abu Dhabi, which has been regulated since December 2025. However, the experience for European users on the platform has not changed since the MiCA deadline on 1 July.

The scrutiny adds to years of regulatory trouble for Binance, including a $4.3bn penalty in the US in 2023 and guilty pleas to criminal charges related to money laundering and breaching US sanctions.