The cryptocurrency exchange Binance is facing a major setback in the European market as its license to operate under the MiCA (Markets in Crypto-Assets) legal framework in Greece is reportedly unlikely to be approved. If this scenario occurs, millions of Binance users in the European Union (EU) could be affected as the transition period for crypto businesses is about to end.
According to sources close to the XEM process, the Hellenic Capital Market Commission is reportedly leaning towards rejecting Binance's license application. This is a significant development because the MiCA license is currently XEM a mandatory requirement for digital asset companies to continue providing legal services throughout the EU.
MiCA is the first cryptocurrency legal framework with scope of application across the entire European Union. This regulation was implemented to standardize the management of the crypto industry among member states, while strengthening investor protection, preventing money laundering, and enhancing the transparency of the digital asset market.
During the transition period, crypto businesses are allowed to continue operating while completing their licensing applications. However, this grace period will officially end on July 1st. After that date, any platform that does not possess a valid MiCA license may be XEM in violation of EU regulations.
Amid reports of potential rejection, Binance affirmed that it has fully complied with MiCA requirements and maintained close cooperation with the regulatory body over the past 18 months. A representative from the exchange stated that the company has not received any official indication that the application will be rejected.
This development comes amidst a strong warning issued in April by the European Securities and Markets Authority (ESMA). The authority stressed that crypto companies continuing to serve EU clients after the regulatory deadline without the appropriate license would face legal action under European law. ESMA also recommended that unlicensed businesses prepare plans to cease operations or transfer clients to approved entities.
In recent years, Binance has devoted significant resources to improving its relationships with regulators globally following a series of controversies related to anti-money laundering. At the end of 2023, the exchange reached a $4.3 billion settlement with US authorities, marking one of the largest penalties in the history of the cryptocurrency industry.
Binance founder Changpeng Zhao (CZ) also previously served a short prison sentence related to regulatory compliance violations. CZ was later pardoned by US President Donald Trump during his current term, after Trump returns to the White House in early 2025.
Since taking over as CEO, Richard Teng has made legal compliance a central focus of Binance's global expansion plan. Under his leadership, the exchange has accelerated its licensing efforts in major jurisdictions, including the Middle East, Asia, and Europe, to strengthen its position amidst increasingly stringent regulations on the crypto industry in various countries.
The developments in Greece are seen by observers as a crucial test for Binance's ambitions to maintain a presence in the European market. If it fails to obtain a MiCA license before the transition period ends, Binance could face restrictions or suspension of some services for EU users, thereby giving a competitive advantage to exchanges that have already completed the licensing process under the new regulations.
Meanwhile, Binance stated that its application for a license to operate under the MiCA framework in the European Union (EU) fully complies with current legal requirements.
