Lagarde's Intervention Derails Binance's EU License Bid
Binance's efforts to obtain an EU license were reportedly hindered by pressure from European Central Bank President Christine Lagarde. According to a Wall Street Journal investigation, Lagarde personally intervened in Binance's application process through Greece, raising concerns about granting the world's largest crypto exchange a regulated base within the European Union.
The ECB president contacted Greek Prime Minister Kyriakos Mitsotakis and expressed her concerns about Binance's compliance record. The European Securities and Markets Authority (ESMA) also advised against allowing the application to proceed, citing issues with Binance's governance and internal controls.
Binance had applied for authorization as a crypto-asset service provider through Greece's Hellenic Capital Market Commission. Although this was a national process, the resulting license could have carried wider consequences, including passporting rights that would allow the exchange to offer services in other EU member states.
The opposition centered on two issues: Binance's compliance record and the monetary role of dollar-denominated stablecoins. Binance had pleaded guilty in 2023 to violations involving anti-money-laundering controls and sanctions, agreeing to pay over $4.3 billion as part of the resolution announced by the US Department of Justice.
The Greek regulator held the legal authority to decide Binance's application, but ESMA sets common supervisory standards and reportedly advised against approval. The ECB does not issue MiCA licenses but has an interest in financial stability and monetary sovereignty.