Convicted CZ’s Ownership of Binance France Imperils EU Market Access

Crypto News– Binance finds itself entangled in legal obstacles within Europe, posing a significant threat to its access to the EU market. The region’s regulatory framework, known as the Markets in Crypto-Assets regulation (MiCA), necessitates regulators to weigh in on whether Binance, entwined in legal complexities, has a place within the bloc.

Convicted CZ’s Ownership of Binance France Imperils EU Market Access

Having surged to a dominating position in the crypto industry, Binance’s stronghold in France has been instrumental. Its subsidiary, Binance France, is duly registered with the Financial Markets Authority (AMF). However, the presence of a convicted criminal as the sole shareholder raises red flags among French regulators regarding Binance’s eligibility for the MiCA license, imperative for its operations in Europe.

William O’Rorke, a lawyer and partner at ORWL, emphasized the criticality of the situation for Binance, stressing the need for uniform application of MiCA across all regions. The outcome of French regulators’ deliberations on Binance’s suitability for MiCA is pivotal, as it could influence decisions across other European countries.

Changpeng Zhao, Binance’s founder and former CEO, faces legal proceedings in a Seattle court, following his guilty plea to money laundering charges in November. As Binance’s new CEO, Richard Teng shoulders the responsibility of rectifying its tarnished reputation and addressing its history of legal controversies over the past seven years.

Binance in France

According to O’Rorke, France holds significant importance as a jurisdiction for Binance’s operations in Europe.

Zhao cultivated strong relationships with officials and commended French President Emmanuel Macron for his progressive policies on innovation.

In 2021, Binance allocated €100 million towards blockchain research and development in France.

However, in June, amidst allegations from US authorities, the Paris public prosecutor initiated an investigation into Binance for suspected money laundering.

Furthermore, in December 2022, a group of investors filed a lawsuit against Binance for illegally marketing to French consumers, seeking €2.4 million in damages.

These ongoing investigations pose additional hurdles for Binance in obtaining its MiCA license. If either investigation yields unfavorable results.