Star Xu, founder of cryptocurrency exchange OKX, publicly accused Binance of pursuing a Markets in Crypto-Assets (MiCA) license in the European Union as a form of regulatory arbitrage. In a post on X, Xu argued that Binance’s renewed effort to secure the license is not about genuine compliance but about exploiting regulatory loopholes, seeking jurisdictions with less stringent oversight.
Xu drew a direct parallel to Binance’s failed attempt to register with the UK’s Financial Conduct Authority (FCA) in 2022. He stated, “The key is whether compliance is genuinely embedded in the organization’s culture and decision-making processes.” He warned that a compliance framework becomes a mere formality if the department lacks decision-making authority or is sidelined for raising concerns about sanctions, anti-money laundering, or market integrity.
The criticism comes as Binance faces a tight deadline of July 1 to secure a MiCA license or cease operations in the EU. The exchange had applied in Greece in January, but on Wednesday it announced it had withdrawn its application there and would pursue authorization in another EU member state. Co-CEO Richard Teng said, “We remain committed to securing a MiCA license in the coming months, while providing clarity, minimizing disruption, and keeping users informed directly.”
Reuters reported that Binance held talks with regulators in Ireland, Latvia, and Greece but faced resistance in all three countries due to concerns over its past money laundering penalties, complex international structure, and risk-taking culture. Binance claims over 300 million users and insists Europe remains an important market. The dispute highlights growing tension over the authenticity of compliance in the industry, as an OKX executive estimated that 80% of crypto exchanges will not survive MiCA.
