European Union regulators are scrutinizing Binance's continued access to customers in the bloc after the world's largest cryptocurrency exchange was required to wind down its European business for failing to obtain a licence under the EU's Markets in Crypto-Assets (MiCA) regime, according to a report by the Financial Times (FT).

The scrutiny centers on the "reverse solicitation" exemption, a provision that permits non-EU financial firms to serve customers who independently initiate a relationship with them. Binance is reportedly relying on that carve-out to maintain its European operations. Officials at the European Securities and Markets Authority (ESMA), the bloc's securities regulator, have stressed that the exemption is narrowly defined and should not be used to circumvent MiCA's licensing requirements.

MiCA, the EU's comprehensive framework for regulating crypto-asset markets, took full effect for crypto-asset service providers in December 2024. The regime requires firms to obtain authorisation in one member state, after which they can "passport" their services to customers across the entire bloc. Firms that do not obtain authorisation are generally prohibited from providing crypto-asset services in the EU.

National regulators, including those in France, Germany, and Greece, are examining Binance's use of the exemption and have sought information from the exchange. Regulators could impose fines or take further enforcement action if they conclude that Binance is operating outside the scope of the exemption. Beyond Binance itself, the reviews could set the reference point for how strictly regulators judge other non-EU firms' reliance on the carve-out, since the exemption is intended for limited, customer-initiated relationships rather than sustained in-bloc operations.

Binance told the Financial Times that it is working toward MiCA authorisation and complies with applicable requirements in the jurisdictions where it operates. The case underscores the two paths available to non-EU exchanges under the regime: obtain authorisation in a member state to passport services bloc-wide, or confine European activity to the narrow bounds of reverse solicitation. Reuters said it could not immediately verify the FT report, while Binance and ESMA did not immediately respond to its requests for comment.

The dispute places reverse solicitation under MiCA under closer scrutiny, as regulators seek to prevent firms without EU-wide authorisation from continuing to serve European customers through exemptions intended for limited, customer-initiated relationships. The national reviews could help define the practical boundaries of the carve-out.