Binance, the cryptocurrency exchange, has encountered another setback in its European operations as its banking partner, Paysafe, withdraws its support. Paysafe has announced that it will no longer facilitate euro-denominated transfers to and from Binance, effective September 25, 2023.
This development means Binance will no longer be able to utilize Paysafe’s embedded wallet solution across the European Economic Area (EEA). The decision comes amid increased regulatory scrutiny on Binance to combat money laundering activities.
Last year, Binance partnered with Paysafe to allow its customers to deposit sterling using the Faster Payments network in the UK. A spokesperson from Binance has said that it plans to find an alternative provider, but in the meantime, all other methods of depositing and withdrawing fiat currencies, as well as crypto trading on Binance.com, will remain unaffected.
In addition to the loss of Paysafe’s support, Binance has also been ordered by Belgian authorities to cease its local operations. Consequently, the exchange’s euro-denominated crypto trading account has decreased to 13% from 31% last year, according to Dessislava Ianeva, an analyst at Kaiko Research.
Paysafe, based in London, has stated that it is working collaboratively with Binance to ensure a fair and orderly process for discontinuing their services over the next few months. Binance has faced ongoing regulatory pressure in Europe and recently withdrew its registration application with the Austrian Financial Market Authority (FMA) following the filing of a lawsuit by the US Securities and Exchange Commission (SEC).
The SEC has accused Binance’s founder, Changpeng Zhao, of mishandling customer funds, violating securities regulations, and misleading regulators and investors. As the SEC lawsuit intensified, the former Binance executive Yi He commented that Binance is not a villain and is in close proximity to regulators for compliance.
Furthermore, Binance has scaled back its plans in Cyprus, the Netherlands, Belgium, and the United Kingdom due to regulatory challenges. Binance Australia has also experienced disruptions in its local banking relationships.
