Binance’s EU Access Comes Under Pressure as Regulators…

Binance is facing renewed scrutiny from European regulators, with authorities in France, Germany and Greece, together with the European Securities and Markets Authority (ESMA), examining whether the exchange is improperly relying on the EU's "reverse solicitation" exemption to keep serving customers after failing to secure a licence under the Markets in Crypto-Assets Regulation (MiCA), according to a Financial Times report.

What regulators are questioning

Reverse solicitation permits a customer inside the EU to approach a crypto company based outside the bloc on their own initiative. Supervisors have warned that the provision cannot be treated as a general substitute for authorization. The current review centres on whether Binance's customer relationships satisfy those conditions, with some regulators having requested information from the exchange.

The probe follows the July 1 deadline for unlicensed firms to wind down EU operations. Binance had already begun adjusting its European business ahead of that date, restricting services and halting new registrations in several markets, including France, Italy, Poland and Spain, after it failed to obtain the required authorization. Binance has said it complies with applicable regulatory requirements in the jurisdictions where it operates and reviews its products and services against relevant obligations, adding that it is working toward obtaining MiCA authorization.

Greek application withdrawn

Binance had pursued Greece as a possible route to MiCA authorization, filing a licence application with Greek regulators that could have provided a basis for offering services across the bloc through MiCA's passporting system. The company withdrew that application shortly before the July 1 deadline, leaving it without a MiCA licence as the transition period for firms operating under previous national arrangements came to an end. The withdrawal followed regulatory difficulties surrounding Binance's European licensing plans.

People familiar with the matter cited by the Financial Times said customers in EU countries where Binance holds no local licence are served through its Abu Dhabi-regulated entity. The report also said Binance continues to see customers in certain EU countries seek to onboard independently without being marketed to. How the exchange determines whether those customers initiated their relationships on their own initiative could prove decisive in whether its reliance on reverse solicitation complies with EU rules. The Financial Times reported that regulators are also examining other crypto companies as part of the wider enforcement of the new framework.