- Binance’s entry into the French market stands in contrast with major European jurisdictions.
- The French MEP and the members of the European Parliament highlighted that the approval was surprising.
- Will the crypto exchange survive the backlash?
Binance, the world’s largest cryptocurrency exchange, received a green light from the regulatory authority in France earlier in May.
However, the French MEP has requested the Autorite des Marches Financiers (AMF) to reevaluate the decision.
According to Aurore Lalucq, the May ruling was only a guarantee of respect for the crypto exchange.
The French MEP and the members of the European Parliament highlighted that the approval was surprising.
Why the Backlash?
Major supervisors have already declined to provide any form of approval to Binance. The French regulator denied disclosing its communication with the lawmakers and the European Parliament. Binance issued a statement that it will proceed beyond the set standards to detect bad actors.
The company insisted that it will cooperate with the French regulator to ensure that all the required demands are met. Aurore informed the press that it was the legislators’ job to ensure clarity over the matter in due course.
In May 2022, AMF listed the Binance subsidiary as a digital asset service provider in France. This came months after long efforts are done by the exchange to convince the regulator. The Binance Chief, Changpeng Zhao had a meeting with the French President Emmanuel Macron in a bid to foster better results.
Binance’s entry into the French market stands in contrast with major European jurisdictions. The slander is geared towards the policies of Binance on consumers and trading. The company has been criticized for its policies on issues pertaining to money laundering and the shielding of customers.
Spanish MEP, Ernest Urtasun, also joined the conversation on Binance policies claiming a lack of transparency. He said that he did not expect this stance to happen in France, since the country has been the toughest on the block on crypto regulation.
A Hurdle for Binance
Binance processed more than $ 2 trillion in derivatives trades last month but is not regulated at the overall group level. In June 2021, the UK’s Financial Conduct Authority insisted that the exchange was not capable of being effectively supervised.
The Authority also warned about the complex and high-risk financial products offered by Binance. FCA reiterated that the financial products posed a significant risk to consumers if they are not regulated.
Regulatory authorities in Italy, Netherlands, Japan and Singapore also warned that the exchange will offer unregulated products. Expanding its market to France was a way for Binance to gain traction in the crypto world.
However, as described by Nicolas Louvet, this was an exceptional red carpet not rolled out for French actors. These remarks came after Binance met with the French President on crypto adoption in the country.
Binance gained its approval as a cryptocurrency service provider in May, through another regulatory agency that covers financial intermediaries.
Recently, the company advanced its mission in the Gulf by securing crypto-asset licenses from Dubai and Bahrain. With the backlash in the European market, will Binance survive the storm?
