Binance questioned over operations in Europe without license: FT

Fresh updates from the financial markets indicate that European Union officials are questioning crypto exchange Binance Holdings Ltd. over its continued operations on the continent after it failed to acquire a license earlier this year, the Financial Times has noted.

The inquiry comes weeks after Bloomberg News noted that Binance — after failing to secure a Markets in Crypto-Assets Regulation license in Greece — has continued to onboard European customers under a “reverse solicitation” provision that allows clients to independently seek out overseas financial providers.

The European Securities and Markets Authority is now looking into Binance’s use of this rule, as are regulators in France, Germany and Greece, according to the Financial Times. Under the EU’s crypto rules, unlicensed entities were required to take steps to start winding down local businesses from July 1 this year.

“Binance complies with applicable regulatory requirements in the jurisdictions in which it operates,” a Binance spokesperson stated in a written statement. “We are actively working toward becoming MiCA-authorized.”

The questioning is a fresh challenge to the world’s largest cryptocurrency exchange, which has faced regulatory troubles in the past. In 2023, the firm agreed to pay $4.3 billion in fines and penalties in the US for failing to implement adequate anti-money laundering controls. Founder Changpeng Zhao additionally pleaded guilty to similar charges and was later pardoned by President Donald Trump.