Regulators Turn Up The Heat On Crypto: Binance Asks To Exit Cyprus

According to CoinDesk’s report, the Cyprus Securities and Exchange Commission (CSEC) received a petition to deregister Binance’s subsidiary in the country. If approved, the crypto company will no longer operate as a service provider in the country.

The application has been uploaded to the CSEC’s official website. The crypto company was granted registration in Cyprus in 2022 under 427114.

The company could offer crypto trading, management, transfer, custody, and other financial services. This included the “provision of investment advice.” As of this writing, the application for deregistration is under examination.

Binance Under Pressure From All Sides

Less than a year ago, Binance celebrated securing a registration to operate in Cyprus. At that time, the crypto company was granted Class 3 registration as a crypto asset services provider (CASP).

In an official statement, the company claimed that clients in the country would have access to staking, spot trading, card services, and other products. In addition, the crypto exchange highlighted its compliance with Cyprus’ anti-money and laundering laws.

Binance wrote on the official blog:

In addition to granting licenses to traditional financial institutions, CySEC is the anti-money laundering and counter-terrorist financing (AML/CFT) supervisor for crypto-asset operations undertaken in or from Cyprus, rigorously assessing AML and Know Your Customer processes. This is another milestone in Binance’s regulatory efforts in Europe and follows similar registrations for Binance’s local entities in France, Italy and Spain.

As of this writing, Binance nor its top leadership provided more details about their decision to leave the country. The crypto exchange has been suffering from increasing regulatory scrutiny from U.S. authorities.

In particular, the exchange was accused by the U.S. Securities and Exchange Commission (SEC) of operating without a license in the country and allegedly offering unregistered securities. At the time of receiving the Cyprus license, the exchange’s CEO, Changpeng “CZ” Zhao, said:

Binance has some of the most thorough AML and CTF compliance policies in the industry. Recognition of the efforts we have made to be on the leading edge of compliance that our registration in Cyprus represents is testament to that. Effective regulation that protects users and stimulates innovation is essential to the continued growth of our industry.

Has any of these aspects changed since its registration, or is Binance simply trying to focus on larger issues? It remains to be seen, for the time being, everything is speculation and should be taken with a grain of salt.

Cover image from Unsplash, chart from Tradingview