EU Regulators Probe Binance’s Use of MiCA Reverse Solicitation Exemption

European regulators are examining whether Binance has relied too broadly on MiCA’s reverse solicitation exemption to continue serving some EU customers without a bloc-wide crypto license.

ESMA and national authorities in France, Germany and Greece are reviewing Binance’s use of the exemption, with some regulators requesting information from the exchange, people familiar with the inquiries told the Financial Times. Enforcement action, including fines, could follow if authorities conclude the conditions were not met.

Binance enters the review without a MiCA authorization after it withdrew its Greek application in June and began restricting services as the EU transition period expired. The exchange later restricted new sign-ups and deposits across France, Italy, Spain, Poland, Belgium and Sweden while keeping withdrawals available.

Reverse Solicitation Requires the Customer to Initiate

MiCA allows a third-country company to provide a crypto service without EU authorization only when the customer approaches the company at their own exclusive initiative. Advertising, promotion or solicitation directed at EU customers removes that protection, and contractual language claiming that a relationship was customer-initiated cannot override the actual circumstances.

The exemption also does not allow a third-country firm to use one customer-initiated request as permission to market new crypto assets or additional services to that customer. ESMA’s reverse solicitation framework treats the route as a narrow exception to Article 59, which generally requires firms providing crypto services inside the EU to hold MiCA authorization.

Binance FZE’s terms explicitly reserve the ability to provide services in other jurisdictions on a reverse solicitation basis. The entity is regulated in Dubai by the Virtual Assets Regulatory Authority, but that authorization does not create MiCA passporting rights inside the EU.

Binance Continues Pursuing MiCA Authorization

Binance remains without an EU-wide CASP license after its MiCA setback. The company said after withdrawing from Greece that it would pursue authorization in another member state and maintain its long-term European presence.

The scrutiny arrives as EU regulators move from MiCA implementation toward tighter supervision. ESMA is separately seeking a broader MiCA framework covering DeFi access providers, staking, lending and additional enforcement tools against unauthorized third-country firms.