Binance Faces EU Service Restrictions Next Week Under MiCA Rules

The European Union fully implemented its Markets in Crypto-Assets regulation, or MiCA, in December 2024 to establish a unified compliance framework for digital assets, marking a key milestone in global crypto regulation. However, its stringent compliance requirements for stablecoins and intermediaries forced many major trading platforms to adjust their services, significantly affecting the flow of EU customer funds from Binance, the world’s largest cryptocurrency exchange.

Binance co-CEO Richard Teng disclosed internal data in July 2026 showing that as much as 70% of funds withdrawn by EU users moved to self-custody wallets after the regulatory transition period ended and new services were suspended. He called the shift an unintended consequence of the regulatory framework, saying it instead drove users beyond its compliance oversight. The EU is now reviewing MiCA 2.0.

The European Union's Markets in Crypto-Assets regulation, or MiCA, provides access to markets in 27 countries under a single license and required firms operating under transitional arrangements to secure authorization by July 1, 2026. Binance, the world's largest cryptocurrency exchange, applied to the Hellenic Capital Market Commission, or HCMC, on January 23. The outcome had implications for its European operations and arrangements for user assets.

Binance withdrew the application on June 24 because of the pace and timetable of the Greek review, missing the deadline. Services in France, Italy, Spain, Poland and other markets were restricted from July 1, while about 400 million euros in assets flowed out in the preceding week. Co-CEO Richard Teng said on July 9 that Binance was in talks with EU regulators that had invited it to apply, with the goal of securing another MiCA license within months.

The European Union’s Markets in Crypto-Assets regulation, or MiCA, requires exchanges to obtain a license in one member state before using the passporting system to serve all 27 countries. The transition period expired on June 30, 2026. Binance withdrew its application in Greece and failed to secure approval in time, a development likely to accelerate the shift of EU users and liquidity to compliant platforms and reshape the exchange landscape.

Starting July 1, 2026, Binance stopped accepting new registrations in several EU countries and restricted some crypto-asset services, although existing assets remained accessible. Coinbase said it obtained a MiCA license in 2025 and offered new users a 5% reward on funds transferred by July 13. OKX offered deposit and transfer rewards of up to 8%, capped at €20,000 and paid over 52 weeks.

The European Union’s Markets in Crypto-Assets Regulation (MiCA) establishes uniform licensing and investor-protection rules for crypto companies, with Spain’s National Securities Market Commission (CNMV) responsible for oversight. The transition period ends on July 1, after which platforms without authorization may no longer provide services, affecting the security of local users’ assets and market order.

The CNMV chairman recently made clear that the July 1 MiCA compliance deadline would not be extended. The regulator is closely monitoring unauthorized platforms including Binance, requiring them to wind down their Spanish services in an orderly manner and properly transfer customers’ crypto assets and funds. Reports have not disclosed the number of affected customers or the value of their assets.

The European Union’s Markets in Crypto-Assets Regulation, or MiCA, has applied in full since December 30, 2024. Once an exchange secures authorization from a single member state, it can operate across all 27 EU countries. Binance chose to apply for a license from the Hellenic Capital Market Commission, making the review’s outcome critical to its European market strategy.

Media reports had said the Greek regulator might reject Binance’s application. Binance responded that its application process had been confirmed as compliant, while the Hellenic Capital Market Commission did not comment at the time. However, the latest reports say Binance has withdrawn the MiCA application it filed in Greece. The company has yet to officially clarify whether it will apply in another member state.