Binance is facing renewed examination from European regulators over its continued service to EU customers following its failure to secure MiCA authorization ahead of the July 2026 deadline.
The European Securities and Markets Authority (ESMA), together with national regulators in France, Germany, and Greece, is investigating whether Binance can legitimately rely on the “reverse solicitation” exemption, according to sources familiar with the matter cited by the Financial Times.
The outcome of this review will influence the scope of Binance’s ability to serve European users while it seeks new MiCA authorization.
Regulators Examine Binance’s Reverse Solicitation Use
Per the Financial Times report, ESMA and regulators in France, Germany, and Greece are scrutinizing Binance’s application of the exemption, with several authorities requesting information from the company. The probe reportedly extends to smaller firms as well.
Under MiCA, unlicensed crypto firms were required to begin winding down EU operations from July 1, 2026, limiting activity to the transfer or sale of client assets.
ESMA confirmed to the FT that reverse solicitation must be interpreted narrowly and cannot serve as a means to circumvent MiCA. The exemption applies when a customer initiates contact independently rather than being subjected to marketing efforts.
The FT also notes that some EU customers are served through Binance’s Abu Dhabi-regulated entity, which obtained authorization in December 2025. MiCA classifies this entity as a third-country firm without passporting rights.
If Binance’s explanations prove unsatisfactory, regulators may pursue enforcement measures including fines.
Binance maintains that it complies with applicable rules and is “actively working toward becoming MiCA-authorised,” reportedly pursuing a licence through France.
Abu Dhabi Routing
Binance may leverage its regulated Abu Dhabi entity as part of its architecture for certain European clients. Regulators are now assessing whether this arrangement alters the fact that services are provided to an EU customer and whether MiCA authorization is thereby required.
Why Does Binance Not Have a MiCA Licence?
Binance previously operated in France under a national PSAN registration granted in 2022. That registration lapsed when France’s MiCA transition period ended on July 2, 2026.
The exchange had pursued EU-wide MiCA authorization through Greece but withdrew the application on June 24, subsequently announcing plans to seek authorization in another member state, specifically France. No MiCA licence was granted before the deadline.
Binance has also encountered significant legal and compliance challenges in recent years, primarily related to anti-money laundering and sanctions adherence.
In 2023, it pleaded guilty in U.S. court to violating anti-money-laundering and sanctions laws and agreed to pay more than $4.3 billion. Authorities stated the company processed transactions involving sanctioned jurisdictions, including Iran.
The firm has since faced renewed scrutiny regarding whether its controls adequately prevent sanctioned or illicit actors from accessing the platform.
Why This Matters
The central issue is whether Binance can invoke “reverse solicitation” and non-EU entities for activity that regulators consider effectively solicited or conducted within the EU. Non-compliance could result in fines or operational restrictions and complicate efforts to obtain MiCA authorization.
