Germany has told leading digital currency exchange Binance that its regulators will not issue a crypto custody license to the firm’s executives.
Germany Denies Binance Proper Licensure
The country is not pleased, allegedly, with the way Binance is handling itself. The company has been on the brink of making every financial agency angry and it has already aroused the wrath of institutions such as the Commodity Futures Trading Commission (CFTC) and the Securities and Exchange Commission (SEC). Both have initiated lawsuits against the firm, claiming it has ignored securities laws for many years and even commingled customer funds with those of the enterprise.
BaFin is the major financial regulator in Germany and is not offering further details regarding the matter for confidentiality reasons. Binance also stated that it wouldn’t offer additional information. However, it did say:
We continue to work to comply with BaFin’s requirements.
Binance hinted that its fight in Germany isn’t over, and it’s currently working on having “the right team and measures in place” to ensure further discussions with the country. The exchange has been encountering multiple issues throughout Europe at press time, with Belgium’s FSMA regulator recently ordering Binance to stop offering any virtual currency services within its borders.
In addition, France is also performing an investigation of the firm. Binance was also made to exit the Dutch crypto scene given it was allegedly unable to meet the nation’s present regulatory requirements. Furthermore, Germany’s BaFin announced in 2021 it was on the verge of fining Binance for allegedly offering certain crypto tokens to clients without proper information supporting said tokens and the company’s tactics.
How Far Will This Lawsuit Go?
Not long ago, many analysts weighed in on the present SEC lawsuit against the crypto company and contemplated the idea of the crypto world existing without Binance. One – Boris Povar, the general director at EYWA – was rather dismissive of the lawsuit and felt it was simply an attempt from the SEC to manipulate crypto into taking a route regulators saw fit. Povar mentioned:
This, to me, looks like nothing more than market manipulation, like the ban on cryptocurrencies in China in the past market cycles. Even if Binance.US closes, it won’t close Binance. This will accelerate Binance’s transition to a fully decentralized structure, which it has been doing for a long time, since the establishment of Binance DEX on the BNB Beacon Chain and launching of the BNB Smart Chain, plus investing in infrastructure projects such as Trust Wallet, Injective Protocol, and others. That is the future pillar of a decentralized Binance. It will gradually be reborn as a decentralized exchange (DEX) and will become stronger, I think. Any closure of the American market for Binance will lead them to develop other markets in Asia and even France.
