Despite Celebrity Power: Belgium Regulator Orders Binance To Cease Immediately All Crypto Services

Binance and Cristiano Ronaldo
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Despite promotional support from soccer star Cristiano Ronaldo, Binance faces fierce global headwinds from regulators. On Friday, the Belgian Financial Services and Markets Authority (FSMA) issued a directive ordering Binance to immediately cease offering or providing crypto services within Belgium. FSMA said Binance currently provides exchange services between cryptocurrencies and FIAT in Belgium and custody wallet services via countries outside the European Economic Area (EEA).

According to the law, individuals or companies governed by the regulations of non-EEA countries are prohibited from engaging in professional activities, even if supplementary or ancillary, that involve providing exchange services between virtual currencies and legal currencies or custody wallet services within Belgium.

Failure to comply with this prohibition can result in criminal penalties as outlined in Article 136 of the Belgian Law on preventing money laundering and terrorist financing.

The FSMA believes that Binance‘s provision of such services in Belgium from non-EEA countries clearly violates this prohibition. Therefore, through its decision dated June 23, 2023, the FSMA has directed Binance to immediately cease offering or providing any exchange services between virtual currencies and legal currencies and custody wallet services in Belgium.

Based on the general terms and conditions applicable to Belgian clients of the Binance.com platform, these services seem to be provided by unidentified Binance operators. Apparently, there are 27 companies involved in the operational and/or technical aspects of providing these services, of which 19 are located outside the EEA.

Despite repeated requests for information, Binance has failed to provide sufficient evidence to prove that the entities responsible for these services in Belgium are legally based in the EEA and authorized to operate within Belgium, as domestic law requires.

In addition to the immediate cessation of activities within Belgium, the FSMA has required Binance to contact its affected clients promptly and, following their instructions, return all cryptographic keys and/or virtual currencies held for their accounts. Alternatively, Binance may transfer these assets to entities governed by the laws of an EEA member state, duly authorized to carry out such activities within Belgium. In the latter case, Binance must take all necessary precautions to ensure the security of these transfers.

CategoriesCrypto FSMA

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