European Union Takes Interest in Binance's Operations

EU regulators are seeking an explanation from Binance as to why the company continues to work with EU customers despite failing to obtain an operating license.

According to the Financial Times, Binance is relying on an exception in EU rules. Under this rule, a company registered outside the EU can, in some cases, serve a European client without a license, provided the client approaches the company first. Regulators are now trying to determine whether Binance is genuinely operating within the bounds of this rule.

Under the EU's new crypto-assets rules, MiCA, crypto companies were required to obtain a license by the end of June in order to continue operating in the EU. Binance's application was not approved, meaning the company could no longer continue working with EU customers under normal terms from July onward.

Some national regulators have already requested additional information from Binance. If the company's explanations prove insufficient, it could face a fine or other sanction. Binance states that it is complying with the current rules and is working on obtaining a MiCA license.

Source: Reuters