In the latest development surrounding Binance, the world’s largest cryptocurrency exchange, the company has officially canceled its registration in the United Kingdom. The UK Financial Conduct Authority (FCA) approved Binance’s request to deregister Binance Markets Limited (BML) (BML) on May 30, 2023, effectively ending its authorization to provide regulated services in the country.
While the termination of Binance’s registration with the FCA may seem significant, it will not impact the exchange’s operations as BML never conducted any business or had users in the UK.
Ilir Laro, Binance’s sub-regional manager for growth in the UK and Europe, clarified that BML had remained dormant since its acquisition by Binance Group in 2020 and had not engaged in any regulated activities.
In March, Binance halted the process of allowing UK customers to withdraw or deposit funds in British Pounds following the termination of its operational agreements with local partner Paysafe. According to data from Kaiko, the exchange previously held a dominant position in terms of cryptocurrency trading volume denominated in Sterling until it lost its banking partner.
Laro stated, “BML was successfully acquired back in 2020 by Binance Group, intended to launch a regulated business in the UK. This attempt was not successful, however, and has since then remained dormant since its acquisition.”
Cryptocurrency Exchange Binance Faces Regulatory Hurdles
Binance’s decision to exit the UK comes amid a series of regulatory challenges faced by the cryptocurrency exchange. The US Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC) have both filed lawsuits against Binance, alleging various violations, including misleading practices and manipulative trading.
The company’s move to withdraw from the Netherlands was prompted by its failure to meet the registration requirements, while in Cyprus, Binance is preparing for the implementation of the Markets in Crypto-assets (MiCA) framework.
With the upcoming enforcement of MiCA in 2024, Binance aims to focus on obtaining permits to operate in key European Union (EU) countries. Binance’s sub-regional development manager in the UK and Europe, Ilir Laro, mentioned that the exchange still holds regulated organizations in Poland, Sweden, France, Italy, and Spain.
Laro emphasized, “Because MiCA, the European law on the regulation of cryptocurrencies, will come into force in 2024, the company will focus on obtaining permits to operate in EU countries.”
Binance’s exit from multiple markets and ongoing regulatory challenges highlight the intensifying scrutiny faced by the cryptocurrency exchange. However, Binance’s strategy director, Patrick Hillmann, expressed the company’s commitment to regulation in the UK despite the difficulties it is encountering in the United States.
Hillmann stated, “We are committed to working constructively with regulators in the UK to develop and promote responsible crypto adoption and innovation.”
As Binance navigates through these challenges, it remains to be seen how the exchange will adapt to regulatory frameworks and maintain its position as a leading player in the cryptocurrency industry.