Binance withdraws Cyprus unit as it aims for EU regulatory alignment

Binance holds registrations in France, Italy, and Spain and will focus on larger markets

Cryptocurrency exchange Binance has requested the deregistration of its Cyprus unit as a crypto service provider, aiming to focus on complying with the forthcoming European Union's Markets in Crypto Assets (MiCA) legislation.

The decision comes shortly after Binance, the world's largest crypto exchange, faced lawsuits from the US Securities and Exchange Commission (SEC) for operating without proper registration and offering unregistered securities. As a result, the exchange stopped all deposits and withdrawals from its US unit.

The Cyprus Securities and Exchange Commission (CySEC) website confirms that Binance is currently under examination for its deregistration application, although no specific reason was provided.

Binance, known for its global operations, plans to ensure full compliance with the MiCA regulations, set to be implemented within the next 18 months. As part of this strategic shift, the exchange intends to scale back its efforts in Cyprus and concentrate on fewer regulated entities within the European Union, as reported by Bloomberg.

Binance successfully obtained registration as a crypto asset service provider (CASP) in Cyprus in October of the previous year, granting it permission to offer spot, custody, staking, and card services within the country. However, with the upcoming MiCA regulations on the horizon, Binance aims to align its operations with the EU's evolving crypto-asset framework.

The move to deregister the Cyprus unit means Binance will no longer be able to directly engage with customers in Cyprus or provide services within the country's borders until the MiCA regulations permit the company to utilize existing registrations from other EU member states.

The crypto exchange has also been expanding in other markets such as Japan and Thailand.

Binance's decision to withdraw from Cyprus follows a series of regulatory actions in the country's crypto industry. CySEC had suspended the license of FTX's Europe unit in November, subsequent to the firm filing for bankruptcy in the US. FTX now faces civil and criminal charges but its new CEO John J. Ray III stated in January that the embattled company could be revived.

Binance's restructuring aligns with its commitment to regulatory compliance and adapting to the evolving global crypto landscape, as it navigates legal challenges and seeks to establish a strong foothold within the EU's regulated markets.

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Written by Silvia Pavlof

Silvia has explored various forms of writing, ranging from content creation for social media to crafting movie scripts. Drawing on her experience as a journalist specializing in the gambling sector, she is currently investigating the impact of cryptocurrencies and blockchain on traditional gambling and iGaming.

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