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Binance seeks approval in Germany as it deepens its expansion

binance
TL;DR Breakdown
  • Binance CEO Changpeng “CZ” Zhao said on Wednesday that the exchange is in talks over regulatory approval in Germany.
  • The development comes amid ongoing talks with other major European economies, specifically Spain and Italy.

Binance, the world’s largest crypto exchange by volume, is in discussions with Germany’s financial regulator to obtain a license to operate throughout Europe’s biggest economy.

The head of Binance, Changpeng Zhao, said that he is actively communicating with German regulators. He said this on the stage at Germany’s Online Marketing Rockstars Festival (OMR). Furthermore, Binance is actively hiring compliance staff for its team in German.

The move comes weeks after Binance registered as a Digital Asset Service Provider with France’s Autorité des Marchés Financiers (AMF). The nation’s Finance Minister reaffirmed his commitment to a European initiative known as PSD2, which will force banks to open up their data to third-party providers.

Binance is working hard to reach new territories and expand its presence in new jurisdictions. The timing is just right since the German is now at the forefront of crypto adoption. 

The country is taking the top spot in the latest Coincub Global Crypto Ranking. German Finance Minister Olaf Scholz announced the government’s intention to regulate and legalize digital assets.

Besides that, Germany’s Federal Ministry of Finance issued the first-ever cryptocurrency tax guide. Previously, Commerzbank, one of the country’s largest and partly government-owned banks, applied for a license for cryptocurrency custody services.

Binance is pushing its expansion

Zhao hopes to bring his trading platform to more parts of the continent, drawing attention to Liechtenstein’s progressive approach toward cryptocurrencies. Binance also has plans for other regions. It has made headway in several middle eastern countries as well this year.

One may recall the statements made by CZ back in the summer of 2021. The crypto mogul said that the world’s largest crypto exchange would be expanding into different countries. The application for a German license comes amid ongoing talks with other major European economies, specifically Spain and Italy. CZ recently met with former Italian Prime Minister Giuseppe Conte and several prominent leaders to talk digital finance. However, it seems there are no commitments yet from either side. Still, the move could hint at lobbying plans in Rome for a crypto license.

Moreover, Binance also complied with a request from Spain’s financial authority to stop offering crypto derivatives in the state. This is a sign that it is willing to play ball with governments to gain approval.

Working closely with global regulators is pivotal for exchanges such as Binance to be given the green light by local authorities in major markets across the globe. The company aims to work only in legal frameworks and be licensed everywhere, with multiple regional headquarters worldwide to be established.

The future of digital assets

In 2022, the expansion of cryptocurrencies has taken a new turn. Everyone wants to rip off a bigger piece—from buying shares in popular start-ups to extensive and intensive development of existing projects.

Still, Binance’s expansion plans come as crypto sees its worst crashes in recent times. Total crypto market capitalization has slumped by over $500 billion in the past two weeks, with markets still under pressure.

Speaking at Finance Forward, CZ said Binance is still “cash flow positive” despite the recent crash and says a boom will follow soon.

Binance to expand across Europe

By actively communicating with German regulators and financial authorities, Binance is confident it will become a significant player in the country. The company is looking to expand its crypto-to-crypto platform across Europe and grow its fiat-to-crypto offering for European users.

Some people are not excited or enthusiastic about the gradual introduction of crypto into the lives of Germans. However, the vector in which the country is moving is crystal clear. A license in Germany, Europe’s largest economy, could open the door to greater regulatory approval elsewhere on the continent.

Nellius Irene

Nellius Irene

Nellius Irene is a cryptocurrency investor and journalist who has been in the nascent space since 2018. She has researched and written on several crypto-related topics including non-fungible tokens (NFTs), decentralized finance (DeFi), fundraising, mining, etc. Her major focus is covering regulatory events that are capable of shaping the entire crypto ecosystem.

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