Binance maintains EU access via reverse solicitation, Abu Dhabi

The MiCA framework began applying to crypto service providers on July 1, requiring a license to operate across the 27 member states. Binance entered July without that authorization, having withdrawn its Greek application in mid-June.

Binance is onboarding new customers under a reverse solicitation clause, which permits unlicensed firms to accept clients who approach them independently. The exchange claims users seeking out its platform fall under this rule. Separately, some EU based trading has been routed through a Binance entity in Abu Dhabi, which operates under a different regulatory framework entirely and allows the company to keep processing transactions for European clients.

European Central Bank President Christine Lagarde reportedly worked behind the scenes to ensure Binance’s Greek application would not be approved. The Hellenic Capital Market Commission was set to discuss the filing on June 17. Binance withdrew it one day prior.

The European Securities and Markets Authority (ESMA) has since sought confirmation from Binance that it is properly winding down its EU business. An ESMA spokesperson declined to comment on specific firms, noting that national regulators are responsible for non-compliance sanctions.

Despite the regulatory pressure, Binance’s market position looks largely unaffected:

• Over 45% of global spot crypto trading volume in late August, according to research firm Kaiko
• 3% to 4% share of euro denominated trading during that same period
• Remains a top downloaded crypto trading app in the EU, per Sensor Tower, with little change in recent months

Some users have reported being initially restricted, then allowed back under the reverse solicitation framework.

Nina-Luisa Siedler, a lecturer at the Berlin University of Applied Sciences who advises on MiCA compliance, says the lack of a license doesn’t automatically force an exchange to close every European account. The fact that they did not obtain the license does not necessarily mean that they need to close all accounts they have for European customers, she said.

Binance has faced regulatory battles before. In 2023, the company agreed to a $4.3 billion settlement with the U.S. government over anti-money laundering, sanctions, and unlicensed money transmission violations. Co-founder Changpeng Zhao also faced prison time as part of that resolution.

Binance states it adheres to regulations in every jurisdiction and is actively working toward MiCA authorization, calling it an important step for providing regulated service in Europe. The exchange has not confirmed which EU member state it plans to pursue next.

Hashlytics Take

Reverse solicitation was written for edge cases, not as an operating model for the largest exchange in the world. Binance is using a narrow legal exception to functionally continue business as usual, and the fact that Lagarde intervened personally suggests regulators already understand this. The real story here isn’t that Binance lacks a license. It’s that a company processing this much euro volume can go two months past a hard deadline with almost no visible consequence, which tells you more about enforcement gaps in MiCA than it does about Binance’s compliance intentions.