The crypto community receives yet another blow as the world’s largest exchange in terms of trading volume, Binance, exits the Dutch market following its failure to secure a virtual asset service provider (VASP) license. Effective immediately, the exchange has stopped registering new users residing in the Netherlands and has informed existing users about their account status and assets on the platform. Trading in the country will cease on July 17, leaving users with the option to withdraw funds from Binance.
Despite engaging in a comprehensive registration application process, Binance has been unsuccessful in obtaining a VASP registration, making it impossible for the exchange to service Dutch residents in compliance with local regulations. Nevertheless, the company vows to continue striving for authorizations that will enable them to provide products and services to the Dutch market.
Binance claims to already be compliant with EU standards on preventing money laundering and terrorist financing. This is evidenced by registrations obtained in other European countries, including France, Italy, Spain, Poland, Sweden, and Lithuania. However, Binance’s departure from the Netherlands raises questions about the broader impact of increased regulatory scrutiny on the crypto space.
This comes as no surprise, as the Dutch central bank previously fined Binance $3.35 million last year for offering services without the appropriate license. In August 2021, the Dutch regulator also warned Binance about operating without the requisite license.
The recent decision to exit the Netherlands coincides with Binance’s move to deregister with the Cyprus Securities and Exchange Commission. Though the reasons behind this step were not disclosed, a Binance spokesperson stated that the exchange aims to be fully compliant before the European Union’s Markets in Crypto Assets (MiCA) legislation is implemented next year.
Binance is now said to be concentrating its efforts on fewer regulated entities in the EU, notably in larger registered markets like France, Italy, and Spain, where it already enjoys a mature footprint. Interestingly, the Paris public prosecutor’s office recently announced that Binance’s French unit faces investigation by local authorities over the “illegal” provision of digital asset services and “aggravated money laundering.”
While the regulatory landscape for cryptocurrencies is fraught with uncertainty, Binance’s exit from the Dutch market signifies a shift in the crypto ecosystem’s struggle for greater acceptance and legitimacy. The coming years will likely witness intensified debates around the advantages and drawbacks of tightening controls on virtual asset service providers, casting an uncertain outlook on the future of crypto exchanges like Binance in Europe and beyond.
Source: Decrypt
