French MEP Calls for Review of Binance Approval by Regulator

For a long time, the EU has been working on the final version of the Markets in Crypto Assets (MiCA) framework, the regulatory guidance that addresses quite a number of grey areas with respect to the regulations in the digital currency ecosystem. But before the regulation was finalized, some of the EU countries started implementing their own initiatives, without waiting for the European Union Council, Parliament, and Commission to reach an agreement. For example, France approved Binance exchange as a Digital Asset Service Provider, becoming the first European country to accept and even license the operations of Binance. It seemed that France’s approval of Binance marked the first step to getting all of Europe on board with major cryptocurrency exchanges. However, not everyone thinks so. According to Aurore Lalucq, a French Member of the European Parliament (MEP) and the European Parliament’s Committee on Economic and Monetary Affairs, the regulators’ decision to register Binance was “incomprehensible.”

Besides, the French MEP cited a previous statement from the United Kingdom’s financial regulator that said Binance was “not capable of being effectively supervised.” Lalucq’s main concern is money laundering and other criminal practices. Therefore, she wants to see more regulation of the cryptocurrency sector.

In June, Lalucq also urged the Autorité des Marchés Financiers (AMF) to review its decision. As she explained, the approval to operate as a DASP gave Binance a “guarantee of respectability.”

Lawsuit Against Binance

Meanwhile, Binance is not as lucky in other countries as it was in France. In June, we reported that Binance was under the investigation of the SEC regarding the BNB token. In particular, the regulator was trying to find out if BNB was security at its initial coin offering back in July 2017.

In addition, the SEC was watching Binance US arm, Binance.US, in order to ensure that the US business is appropriately operating independently from the crypto company.

Soon after the investigation started, Reuters reported that Binance facilitated crypto theft for years, being a hub for hackers. The report explained that the crypto exchange aided investment funds, hacks, and sales of illegal drugs between 2017 and 2021.

Furthermore, Binance faced criticism from a number of investors who have filed a lawsuit against Binance.US for misleading the public into buying the UST and LUNA coins. According to the investors, the exchange was selling unregistered LUNA and UST securities and misled people into purchasing them, while the coins were crashing.

Notably, Binance seems to have been prepared for this investigation. The exchange has spent tens of millions of dollars hiring the best cyber forensics team in the world, which includes over 120 security and industry experts from all over the world.