Binance defends EU MiCA application as rejection reports mount
In brief
- Binance's MiCA application under ESMA review following Greece regulator assessment
- EU regulators reportedly preparing to reject exchange's licensing bid
- Rejection risks weakening liquidity and pushing crypto activity outside EU
- June 30 deadline looms; Binance loses EU operating rights July 1 if denied
The licensing timeline
Binance applied for MiCA licensing in Greece under the Hellenic Capital Market Commission (HCMC) in January. Greece's regulator completed its review and considered the application compliant with MiCA requirements, subject to approval at the European Securities and Markets Authority (ESMA).
The stakes are high. Under the MiCA framework, companies operating in the EU only have until the end of June to gain approval to offer services to residents. Should Binance's application be rejected, the exchange would likely be unable to legally operate in the EU starting on July 1.
Binance's response
Reuters reported that EU regulators were preparing to reject Binance's licensing bid, potentially cutting off the exchange's ability to offer services to residents. In response, Binance framed the potential rejection as a broader market concern.
"It risks weakening liquidity, reducing competition and user choice, and pushing activity, jobs, investment, and tax revenue outside the EU." — Binance
A Binance spokesperson told Cointelegraph that the company expected ESMA intended to progress the licence and move to authorise at an upcoming board meeting.
Regulatory precedent
The rejection threat stands in contrast to other jurisdictions. Several regulators, including those in Germany and the Netherlands, have already approved licenses for crypto companies seeking to be compliant under MiCA. That pattern suggests ESMA's decision carries outsized weight for how the bloc's crypto framework will function in practice.
Binance's regulatory history includes a 2023 settlement with US authorities. The company reached an agreement in which then-CEO Changpeng Zhao stepped down and pleaded guilty to one felony charge, and Binance agreed to a $4.3 billion settlement. The EU decision will test whether that compliance record carries weight in Europe's stricter regulatory environment.
