The Financial Services and Markets Authority (FSMA) has issued an order to Binance, the world’s largest crypto exchange by trading volume to stop servicing clients in the country. The regulator issued the order Friday 23 June.
The reason for the order is that Binance has been servicing Belgian citizens from countries that are not within the European Economic Area (EEA). Binance is to immediately stop offering its digital asset exchange and crypto custody services in the country, as well as return all customers’ crypto holdings and keys.
According to FSMA, Binance did not dispute offering such services in Belgium, confirming its suspicion. The agency said 27 “Binance operators” were providing operational and or technical support for Binance’s crypto exchange and custody services to Belgian clients.
FSMA decided to stop Binance’s operations when the exchange failed to proof that 19 of the 27 operators “are in fact based in the European Economic Area and are authorized, based on their domestic laws, to provide such services in Belgium,” the watchdog noted.
In a statement, the agency stated that no entity is allowed to offer crypto services to Belgians outside of the EEA.
“Persons or firms governed by the law of a country that is not a member of the European Economic Area are prohibited from offering or providing, within Belgium, by way of a professional activity – even if supplementary or ancillary – exchange services between virtual currencies and legal currencies or custody wallet services,” FSMA said in a statement.
Binance Fighting Multiple Battles
Binance has been the biggest crypto exchange by trading volume for years. It seems this title has recently drawn too much attention to the exchange as it is currently facing challenges with regulators in many countries all at once.
At the top of the list is the United States, where the exchange has been in court for weeks, trying to defend itself and the CEO Changpeng Zhao from allegations of securities laws violation and mishandling of customer funds.
Just last week, the exchange had to move out of the Netherlands because of its inability to secure a Virtual Asset Services Provider (VASP) license in the country. The Belgian authorities are the latest to order the platform to stop offering its services.
Similarly, the securities and exchange commission (SEC) in Nigeria has ordered an entity known as Binance Nigeria to stop offering its services to Nigerians. The SEC referred to the company as illegal, and cautioned citizens against using their services.
Although Binance has since denied any affiliation with an entity with that name, this shows how the global exchange has been targeted by regulators all over the world.
More Regulatory Pressure Underway
The EU recently passed a crypto regulatory bill for member countries. This has caused a kind of awakening in Europe which could trigger stricter regulatory measures. This means that Binance may be facing more regulatory hurdles in the region in the future.
