Belgium’s Financial Services and Markets Authority (FSMA) has directed cryptocurrency exchange Binance to immediately cease all virtual currency services in the country. The FSMA stated that Binance’s provision of exchange and custody wallet services from non-European Economic Area (EEA) countries violates the prohibition on offering such services in Belgium. Failure to comply with the order may result in criminal sanctions under Belgian law. The FSMA also demanded that Binance return cryptographic keys and virtual currencies held for Belgian clients or transfer them to entities authorized to carry out such activities under EEA member state law.
The FSMA clarified that while providing virtual currency exchange services and custody wallet services remain unregulated activities in Belgium, they are subject to anti-money laundering and terrorist financing measures. The forthcoming Markets in Crypto-Assets (MiCA) regulation from the European Union, effective from January 2025, will introduce more comprehensive rules, including prudential regulations, for crypto-assets activities.
Binance is currently facing increased regulatory scrutiny globally, including charges from the U.S. Securities and Exchange Commission (SEC) and the cessation of operations in the United Kingdom. The exchange has also withdrawn from the Netherlands and seeks deregistration in Cyprus, while facing investigations in France for alleged money laundering and regulatory violations.