After the United States declared open war on cryptocurrency exchange Binance, Europe is also proving to be an increasingly unfriendly territory for the digital asset market giant. Owned by Changpeng Zhao (CZ), the platform had hoped that Germany would become one of its new hubs on the Old Continent. However, recent reports suggest that the local financial market regulator, BaFin has not looked favorably on Binance's application.
BaFin Rejects Binance's Bid in Germany
According to information published by a German financial news website, Finance Forward today (Thursday), insiders claim that BaFin is unwilling to grant Binance a crypto custody license. Binance's press spokesperson has not confirmed these reports but commented to CoinDesk that the exchange is continuously working to meet all the requirements set by BaFin. He acknowledged that it is a complicated and lengthy process, but the platform is still hopeful for a positive conclusion.
If Binance fails to obtain a license in Germany, its business development in Europe may be in question. This is especially true given that the exchange has significantly limited its local presence due to regulatory changes.
Finance Magnates reported two weeks ago that Binance is exiting Cyprus and the Netherlands. Since then, the platform has come under scrutiny from the French prosecutor's officefor operating an 'illegal' exchange; it withdrew its license in the United Kingdom; and it was forced to leave Belgium.
The challenges in Europe are further exacerbated by the fact that Paysafe Solution, Binance's euro banking partner, is suspending support for further payments from the end of September 2023.
⚠️ Binance #Crypto Custody License Application Denied by ???????? German Regulator BaFin ‼️????Several blows to #Binance in ???????? EU ????#CryptoNews #Cryptocurency #BNBhttps://t.co/OnebGzBdTA
— Ajay Kashyap (@EverythingAjay) June 29, 2023
Binance Shifts Focus to Asia and the Middle East
Although Binance does not claim to be withdrawing from Europe, but rather adjusting its local strategy to comply with new regional cryptocurrency regulations (MiCA), it is faring considerably better on other fronts.
A week ago, Binance entered the Central Asian market by launching local services in Kazakhstan. The new platform will allow users to trade and store digital assets, make fiat deposits and withdrawals, as well as avail conversion services.
A representative from the exchange also hinted earlier this week that faced with regulatory pressure in the US and the EU, the Middle East might become Binance's primary target. These words came from Alex Chehade, the General Manager of Binance Dubai. According to Chehade, the United Arab Emirates (UAE) have favorable and transparent regulations regarding digital assets.
At a time when the EU is implementing MiCA and the United States is clashing with crypto exchanges, the giants of 'traditional finance' are seeking their place at the growing cryptocurrency table. Over the past two weeks, more companies have joined the collection of applications for the establishment of a spot Bitcoin ETF, which was initiated by BlackRock. ARK Invest, BitWise, and Invesco also want to offer a similar instrument.
Although US regulators have rejected such applications in the past, Wall Street giants are hoping that the current 'negative PR' around crypto exchanges will increase the chance of launching fully regulated instruments.
This article was written by Damian Chmiel at www.financemagnates.com.
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