Crypto Giant Binance Struggles in Europe
Crypto giant Binance opened a regional headquarters in Paris last year, hoping to expand its business in Europe. Things haven’t gone its way. The Netherlands and Belgium have shut their doors to the exchange.
Germany, Europe’s largest economy, hasn’t yet given it a license to operate. And French prosecutors recently searched the exchange’s office as part of an investigation of money laundering controls. Binance’s share of euro-denominated crypto trading has fallen to about 15% from over 30% in January, according to research firm Kaiko.
Regulators have shifted gears this year, placing greater scrutiny on crypto exchanges’ operations following the collapse of FTX. The harsher stance from European regulators threatens to further curtail Binance’s footprint and force it to increasingly rely on markets in Asia, Africa and Latin America. Countries such as Vietnam, Turkey, India and Argentina already draw the highest user traffic at Binance, although France, Germany and the Netherlands are in the top 25, according to May data from analytics firm SimilarWeb.
The setbacks add to Binance’s woes in the U.S., where it is battling a lawsuit from the Securities and Exchange Commission and an ongoing criminal investigation from the Department of Justice. A Binance spokesman said the company is focused on meeting the requirements of a new European Union legislation that will govern digital-asset companies across its 27 member states expected to kick in next year. In the meantime, he said, “we continue to work to proactively comply with our requirements." Crypto firms are excited about the new EU legislation, called MiCA, because it will allow for companies authorized in one member state to offer services in all of them.
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