The post Binance and CEO “CZ” in the Eye of the Regulatory Storm in Europe appeared first on Coinpedia Fintech News
The world’s largest crypto exchange, Binance, and its CEO Changpeng “CZ” Zhao find themselves in hot water as regulators from the Euro area tighten their grip, coming on the heels of lawsuits against Binance by the U.S. SEC and CFTC. Binance’s recent decision to withdraw its operations from several EU countries marks the latest development in the ongoing saga, with Germany being the freshest exit point following a regulatory advisory to withdraw its licence application.
BaFin Points Fingers at Binance’s Regulatory and Organizational Structure
Germany’s financial watchdog, BaFin, raised concerns over Binance’s CEO and the crypto exchange’s intricate organizational structure, according to a report by the Wall Street Journal. Sources familiar with the situation suggested that CZ would likely not pass a regulatory “fit and proper” test. Additionally, the labyrinthine structure of Binance has reportedly made regulatory oversight significantly challenging.
Binance’s Troubled European Tour
Binance’s regulatory troubles are not limited to Germany. The company has retracted licence applications in the Netherlands, Austria, and Cyprus. The cryptocurrency giant is under intense scrutiny from regulators in France and Belgium and has already faced a regulatory backlash from the UK, where it lost its partnership with a European banking partner, PaySafe. With the loss of USD and AUD support, some observers argue that Binance is progressively being shut out from the European banking system.
Executive Exodus and Binance’s Response
Top executives have left from various Binance subsidiaries worldwide, adding more fuel to the fire. However, the company maintains a robust stance in the face of these mounting challenges. A Binance spokesperson stated that the exchange voluntarily withdrew its application for several reasons, including its ongoing efforts to acquire a new European Union crypto licence.
“Binance will continue to cooperate with the regulatory authorities and continues to pursue the necessary regulatory approvals to actively conduct business in Germany,” the spokesperson affirmed.
Binance’s Uncertain Future
As regulatory walls close in, the road ahead for Binance and CZ in Europe looks increasingly fraught with hurdles. Amidst this tumultuous climate, the ultimate fate of the cryptocurrency behemoth in Europe hangs in the balance. The crypto world will undoubtedly keep a close eye on the next moves of Binance and its charismatic yet controversial CEO, CZ.