CoinDesk
Binance withdrew its MiCA license application in Greece last week after months of discussions with regulators, forcing the world's largest crypto exchange to suspend some services and freeze new EU user registrations just ten days before the July 1 deadline, with affected users notified in several EU countries. The exchange's Europe head Gillian Lynch told CoinDesk the company had been told in April that its application was complete and had expected authorization in early June, before board meetings were repeatedly postponed and the firm chose to withdraw.
ESMA privately advised national regulators to disapprove Binance's MiCA applications, citing issues meeting financial-crime rules, the Wall Street Journal reported on Wednesday. The Wall Street Journal also reported that Binance's compliance staff flagged concerns that the exchange's leadership ignored. Lynch disputed the reporting as a mischaracterization, said the accounts referenced were offboarded and reported to law enforcement as soon as the activity was identified, and called suggestions of ignored sanctions concerns or retaliation against compliance staff categorically false. Binance previously sued the WSJ over earlier reporting on Iran-linked accounts.
Why it matters
Lynch framed MiCA's success as a question of inclusion rather than rulebook existence. "Is the success of MiCA that we have regulation, or is the success that the players are regulated?" she asked. Despite the Greek withdrawal, she backs the architecture of national regulators granting licenses with ESMA playing a larger supervisory role over the largest firms, and pointed to Binance's $300 million-plus annual compliance spend and 1,500-plus compliance staff as evidence of regulatory commitment.
The standoff has industry-wide stakes. Of roughly 3,000 virtual asset service providers operating in the EU, almost 80% may not survive MiCA, according to OKX Europe CEO Erald Ghoos.
Frequently asked questions
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Why did Binance withdraw its Greek MiCA license application?
Binance withdrew after months of regulatory discussion, with Europe head Gillian Lynch saying the application was deemed complete in April and authorization was expected in early June before board meetings were repeatedly postponed and the firm chose to withdraw just ten days before the July 1 deadline.
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What role did ESMA play in Binance's MiCA application?
ESMA privately advised national regulators to disapprove Binance's MiCA applications, citing concerns about the exchange's ability to meet financial-crime compliance rules, according to the Wall Street Journal.
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How many EU crypto firms could fail under MiCA?
Almost 80% of the roughly 3,000 virtual asset service providers operating in the EU may not survive MiCA, according to OKX Europe CEO Erald Ghoos, with more than 10 million users facing migration to approved platforms.
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How did Binance respond to the Wall Street Journal reporting?
Lynch called the WSJ reporting a mischaracterization, said the accounts in question were offboarded and reported to law enforcement as soon as the activity was identified, and called suggestions of ignored sanctions or retaliation against compliance staff categorically false. Binance previously sued the WSJ over…
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Will Binance re-enter the European market?
Lynch said Binance is committed to staying in Europe, expects the next licensing application to move faster because much of the Greek regulatory work is complete, and that the exchange will return to the European market. "We're not leaving Europe. This is an obstacle in our way at the moment."
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