Lagarde Reportedly Opposed Binance EU License Over Compliance, Stablecoin Risks

European Central Bank President Christine Lagarde reportedly raised objections to Binance’s attempt to secure a European Union crypto license, citing the exchange’s past U.S. regulatory violations and concerns over the growing use of dollar-backed stablecoins in Europe.

Binance sought authorization as a crypto-asset service provider through Greek regulators under the EU’s Markets in Crypto-Assets (MiCA) framework. A license granted by one member state can generally allow a crypto company to operate across the bloc under MiCA’s passporting system.

Greek authorities reportedly informed the European Securities and Markets Authority in early June that they planned to approve Binance’s application. The crypto exchange was preparing for a formal European launch, including a planned visit to Athens by CEO Richard Teng.

However, an official at Greece’s Hellenic Capital Market Commission later told Binance that Lagarde opposed the application, according to a Wall Street Journal report citing people familiar with the discussions.

Lagarde’s reported concerns were partly linked to Binance’s previous legal troubles in the United States. The exchange pleaded guilty in 2023 to violations involving U.S. anti-money laundering and sanctions rules as part of a multibillion-dollar settlement. Lagarde reportedly viewed that history as a potential compliance risk for European regulators.

Another concern involved the ECB’s digital euro initiative. Lagarde reportedly worried that expanding Binance’s presence across the EU could encourage greater adoption of U.S. dollar-denominated stablecoins, potentially complicating European efforts to strengthen the euro’s role in digital payments.

The ECB does not have formal authority to approve or reject crypto exchange licenses under MiCA. Licensing decisions are handled by national regulators, although authorization in one EU country can provide access to markets throughout the bloc.

Binance ultimately withdrew its Greek MiCA license application in mid-June before the HCMC issued a formal ruling. The exchange also halted marketing to EU customers after failing to secure authorization by the July licensing deadline.