Crypto exchange Binance has withdrawn its application for a license from German financial regulator BaFin, marking its latest European regulatory move.
"Binance confirms that it has proactively withdrawn its BaFin application," a Binance spokesperson told The Block. "The situation, both in the global market and regulation, has changed significantly. Binance still intends to apply for appropriate licensing in Germany, but it is essential that our submission accurately reflects these changes."
The statement comes a month after German publication FinanceFwd reported that BaFin had decided not to grant Binance a crypto custody license. Binance told the news outlet at the time that conversations were still ongoing.
Changing regulatory landscape
Binance is grappling with mounting regulatory challenges, not just in Europe but across the globe. In recent weeks and months, Binance has exited the Netherlands, deregistered entities in Cyprus and the U.K., withdrawn its license application in Austria, was ordered to stop operating in Belgium and is reportedly facing an investigation in France for alleged money laundering. Binance and its CEO, Changpeng Zhao, also face lawsuits from U.S. regulators.
Binance previously said it is working to prepare its business to be fully compliant with Markets in Crypto Assets (MiCA), European Union's regulations, when they are implemented in the next 18 months. To that end, Binance at the time said that it moved to pull back efforts in certain states to focus on having fewer regulated entities in the EU, especially its larger registered markets where it already has a mature footprint, including France, Italy and Spain.
MiCA mandates that crypto companies operating in the EU must obtain authorization from one member state by January 2025. This authorization can then be used across the entire region, allowing companies to provide services to local residents with a single EU license.
Binance, however, is facing banking issues as well in Europe. Its current euro banking partner, Paysafe, will cease supporting the crypto exchange after September 25. Paysafe's decision will impact euro-denominated bank transfers to and from Binance through the Single Euro Payments Area (SEPA) network. Paysafe already ended British pound support for Binance in May.
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