EU questions Binance’s continued operations in the region

By the Editorial Team · Friday, October 2, 2026

European regulators are investigating Binance’s continued operations in the EU despite the exchange failing to obtain a required license under the new MiCA rules and relying on a legal exemption called "reverse solicitation." This scrutiny could lead to enforcement actions if Binance is found to be circumventing EU regulations, highlighting increasing regulatory pressures on major cryptocurrency platforms in the region.

European regulators are scrutinizing Binance’s continued operations in the European Union despite the cryptocurrency exchange's failure to obtain a license under new EU rules and an order to cease its activities in the bloc. The review focuses on Binance’s reliance on a legal exemption known as "reverse solicitation," which allows companies based outside the EU to offer financial services to customers within the region only if those customers initiate contact independently.

Binance, the world’s largest crypto exchange, did not secure regulatory approval under the EU’s Markets in Crypto Assets (MiCA) framework, which came into effect on July 1. The rules require unlicensed crypto firms to immediately wind down their EU businesses and restrict them from providing services to customers except to assist in transferring or selling their digital assets.

The European Securities and Markets Authority (ESMA), along with national regulators in France, Germany, and Greece, is investigating whether Binance's use of reverse solicitation complies with these requirements. Several regulators have requested information from the company as part of the inquiry, which adds to ongoing regulatory pressures facing Binance. Earlier this year, the exchange was fined $4.3 billion by U.S. authorities and pleaded guilty to criminal charges involving money laundering and sanctions violations.

Originally gaining prominence after Brexit as a way for UK-based firms to continue servicing EU clients without EU licenses, the reverse solicitation exemption is intended to be narrowly applied. ESMA underscored that the exemption should not be used to circumvent MiCA regulations and must be regarded as an exception rather than a loophole.

Binance has maintained that it complies with regulatory obligations in every jurisdiction where it operates. The company also emphasized its efforts to obtain MiCA authorization, calling it a key step toward providing a consistent and regulated service across the European market.

Regulators are reported to be reviewing similar practices among other smaller crypto firms as well. If Binance’s explanations are deemed insufficient, authorities may proceed with enforcement actions to ensure compliance with the EU’s regulatory framework.

This article was reported by synthesizing coverage from multiple independent news outlets to present a balanced, unbiased account. Read about our editorial standards. Spotted an error? Let us know.