WatcherGuru
Changpeng Zhao, the former CEO of Binance, publicly criticised European regulators on Saturday for what he called a deliberate decision to deny the exchange a MiCA license, framing the move as EU policymakers "cutting their users off from the best liquidity in the world."
Why it matters
MiCA, the EU's Markets in Crypto-Assets regulation, took effect in stages through 2024 and 2025, requiring every crypto-asset service provider serving European customers to hold a license in a member state. Once fully enforced, venues operating without MiCA authorisation lose passporting rights across the bloc and face being pushed to offshore or restricted-service models. Zhao's framing recasts that technical compliance question as a competitive one: which exchanges get to intermediate European flow at all.
Market impact
Zhao's intervention keeps the spotlight on Binance's structural disadvantage in the EU relative to rivals that have secured MiCA authorisations, including Kraken, Coinbase, and several European-headquartered venues. For European traders, the practical read is concentration risk: liquidity pools narrow around the licensed set, and pricing on major pairs increasingly reflects the depth available inside that perimeter rather than global book depth. Zhao's argument is that European users end up paying for it.
Frequently asked questions
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What is MiCA and why does it matter for crypto exchanges?
MiCA is the EU's Markets in Crypto-Assets regulation, phased in through 2024 and 2025. It requires every crypto service provider serving European customers to hold a license in an EU member state, and licensed venues get passporting rights to operate across the entire bloc.
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Why is CZ saying the EU is cutting users off from liquidity?
Zhao argues that by not authorising Binance under MiCA, EU regulators force European users onto a narrower set of licensed venues, whose combined order-book depth is smaller than the global liquidity Binance intermediates elsewhere.
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Has Binance been denied a MiCA license in the EU?
Binance has not secured a MiCA authorisation in any EU member state, while competitors including Kraken and Coinbase have. That leaves the exchange without passporting rights to serve European customers under the new framework.
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Which exchanges have obtained MiCA licenses so far?
Several major venues have secured MiCA authorisations, including Kraken, Coinbase, and a handful of European-headquartered exchanges. The full licensed set determines which platforms can intermediate European flow under the unified regime.
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What does this mean for European crypto traders?
European traders are increasingly routed to the licensed set of venues. That concentrates flow, narrows the available liquidity pool relative to global books, and can translate into tighter spreads or worse execution on major pairs depending on the venue.
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