EU Watchdogs 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.

Binance failed to secure a licence under the Markets in Crypto-Assets Regulation (MiCA) this summer and was expected to take 'immediate steps' to shut down its operations by July 1st. However, the company continues to operate, using what is known as the 'reverse solicitation exemption', which allows companies based outside the EU to serve customers in the bloc if those customers seek out the service entirely on their own initiative.

The European Securities and Markets Authority (ESMA) and national regulators are examining how Binance uses this exemption and have asked the company for information. If they are not satisfied with its answers, regulators could take enforcement action, including fines.