WuBlockchain
Binance is under scrutiny over its use of MiCA’s reverse solicitation exemption to continue serving some European customers after failing to secure a license, the Financial Times reported. ESMA and regulators in France, Germany and Greece are reviewing whether the exchange qualifies for the exemption.
Why it matters
Reverse solicitation is a narrow route for serving EU customers who approach a firm on their own initiative. The question for regulators is whether Binance’s use of that route meets MiCA’s requirements, rather than functioning as an alternative to licensing.
Market impact
If regulators reject Binance’s interpretation, the exchange could face enforcement action. The review puts its ability to serve the customers covered by the exemption in question, but no decision or action has been announced.
Frequently asked questions
-
What is the MiCA reverse solicitation exemption?
It is a narrow route for serving EU customers who approach a firm on their own initiative.
-
Which regulators are reviewing Binance’s use of the exemption?
ESMA and regulators in France, Germany and Greece are reviewing whether Binance qualifies.
-
Why is Binance relying on the exemption?
Binance has used it to continue serving some European customers after failing to secure a license.
-
What happens if regulators reject Binance’s interpretation?
Binance could face enforcement action. The review also puts its ability to serve customers under the exemption in question.
-
Have EU regulators taken enforcement action against Binance in this case?
No decision or enforcement action has been announced in connection with this review.
CryptoSlate
CoinDesk
TheBlock
Crypto News