EU Regulators Press Binance Over Reverse Solicitation Loophole After MiCA License Failure

Binance failed to win a license under Europe's new crypto rulebook this summer. It is still serving European customers anyway, and regulators want an explanation.

The European Securities and Markets Authority, along with national watchdogs in France, Germany, and Greece, is questioning the exchange about how it keeps EU clients on board, the Financial Times reported. Some of those regulators have formally requested information. If the answers don't satisfy them, enforcement, including fines, is on the table.

The narrow door Binance is walking through

The fight centers on reverse solicitation. It's a narrow exemption that lets a firm without an EU license serve a European client, but only if that client reaches out entirely on their own, unprompted by marketing.

Regulators clearly think that door is being propped open. ESMA has said the exemption is very narrowly framed and must not be used to circumvent MiCA. The Dutch AFM was even blunter: providers cannot simply claim reverse solicitation and carry on as before.

Under MiCA, unlicensed firms were expected to start winding down EU business from July 1, keeping only the ability to help clients move or sell their holdings. Business as usual was not part of the plan.

Licenses lapsed, customers didn't

Binance's local registrations in France, Spain, and Poland lapsed under the new regime, part of a licensing saga that included the reported moment when Lagarde blocked Binance's MiCA license. Traders in other EU countries have reportedly been served through Binance's Abu Dhabi entity, which has been regulated there since December 2025.

Binance told the FT it complies with the rules wherever it operates and is actively working toward MiCA authorization. It isn't alone under the microscope, either. Smaller crypto firms leaning on the same exemption are also being reviewed.

The standoff is a test of whether Europe's crypto rules have teeth. Washington is building its own framework, with the Fed working on stablecoin rules under the GENIUS Act, and both sides of the Atlantic are learning the same thing: writing the rules is the easy part. Making the biggest exchange in the world follow them is harder.