Compliance
EU Regulators Investigate Binance's Use of MiCA Exemption for Crypto Services
European regulators are currently investigating Binance, the world's largest cryptocurrency exchange, over its alleged use of the reverse solicitation exemption to continue providing services to customers in the European Union. This inquiry follows the exchange's failure to secure a license under the Markets in Crypto-Assets (MiCA) regulations.
According to reports from the Financial Times, authorities including the European Securities and Markets Authority (ESMA) and regulators from France, Germany, and Greece are examining whether Binance is improperly relying on this legal loophole. The reverse solicitation exemption allows companies outside the EU to engage with customers who independently initiate a business relationship, but it comes with strict limitations.
Regulators have expressed concerns that Binance may be misclassifying these relationships as reverse solicited, particularly in jurisdictions where it does not hold local licenses. The Dutch financial regulator, AFM, has also emphasized that providers cannot simply claim that customers approached them first without adhering to clear guidelines.
Binance's operations in Europe have faced challenges, including the lapse of licenses in France, Spain, and Poland, and a failed MiCA license application in Greece. Despite these setbacks, Binance has stated that it is actively working towards obtaining MiCA authorization and plans to continue its operations in the region.
As the investigation unfolds, regulators may impose fines or other enforcement measures if Binance's explanations do not satisfy their inquiries.
New Developments in MiCA Licensing
On September 30, 2026, Latvijas Banka granted a double licence to Noah LV SIA, enabling it to operate as both a crypto-asset service provider and a payment institution under the EU’s Markets in Crypto-Assets (MiCA) framework.
This approval allows Noah to offer services including custody and administration of crypto-assets, exchanging crypto-assets for fiat currency, swapping crypto-assets, and executing orders.
As of October 1, 2026, a total of 12 companies have received MiCA licences from Latvijas Banka, with the first licence issued to BlockBen SIA in December 2025.
Latvia's strategy aims to position itself as a fintech and crypto-friendly jurisdiction, potentially enhancing foreign investment and competition among EU states for crypto business.
The MiCA licence provides passporting rights across the EU and EEA, allowing firms to operate in multiple member states without additional licensing processes.
FAQ
What is the MiCA regulation?
The Markets in Crypto-Assets (MiCA) regulation is a legislative framework established by the European Union to regulate cryptocurrency assets and services, ensuring consumer protection and market integrity.
What is the reverse solicitation exemption?
The reverse solicitation exemption allows companies outside the EU to provide services to customers in the EU if those customers independently initiate the business relationship, but it has strict limitations and requirements.
Why are regulators investigating Binance?
Regulators are investigating Binance for allegedly misusing the reverse solicitation exemption to provide services in the EU without proper licensing under MiCA regulations.
What challenges has Binance faced in Europe?
Binance has faced challenges such as the lapse of licenses in France, Spain, and Poland, as well as a failed MiCA license application in Greece.
What could happen if Binance does not comply with regulators' inquiries?
If Binance's explanations do not satisfy regulators, they may face fines or other enforcement measures as the investigation unfolds.