EU regulation continues being unenforcable

[alani123]

EU's regulatory arm just ridiculed themselves.

They made it such a point to regulate crypto, sold licenses through national oversight authorities, and somehow exchanges that operate without a license are still operating with full bank access in the EU.

https://www.amlintelligence.com/2026/07/binance-mexc-and-htx-accessible-eu-users-mica-licences/

The exchanges that didn't end up getting a license just straight up ignored the lawfare and continue working and systemic means of payments such as banks and cards are very happy to keep processing payments for them also. The EU continues to vote on legislation it can't and is unwilling to enforce once again. This ends up being funny after a certain point.

[bitbollo]

I don't know if this is strictly related but it seems Bitmex would close activities.
About processing transaction without a "license", at the end they are just moving the risk to the single user since it's their responsibility to provide all instructions to relative authority.
Here there is the problem (at least on my opinion). Crypto users are living in a juridical limbo pressed between two options - governments and big companies.

[NeuroticFish]

EU's regulatory arm just ridiculed themselves.

They were incredibly overconfident that the regulations will be properly implemented in the correct time frame and by everybody.
Of course, for various reasons, the time frame was too small and too early.
Some countries have pretty much nothing in place (I mean, not even to give the licenses and hence cash in whatever the related fees are). Some countries overstated their capabilities and schedule.
And yeah, this made that even major companies ended up without license when the time was up.

The rest of the story? I don't know whether it's lobby, or there's good will because of being late with the licenses, or the "enforcement" capabilities are also missing, but this is the result.
Imho it's a bit of all. You don't start enforcing the rules just like that because some tax paying companies may leave to somewhere neither the licensing nor the enforcing works.

Ridiculous? Yep. But aren't they ridiculous with their overall hostility against bitcoin in the first place? So nothing new.

[Z-tight]

Many of the services that failed to get the license within the transitional period are still actively working to get it. I don't think they are just freely operating illegally, because there would be consequences, i.e. very heavy fines. Binance for example have withdrawn their application from Greece, and are actively seeking authorization from another jurisdiction.

My point is, i don't think any service would risk the penalties they could incur for operating illegally. So, it is either they are slowly winding down, or they suspend certain activities for EU users in their platform, while they work on getting licensed.

[alani123]

Many of the services that failed to get the license within the transitional period are still actively working to get it. I don't think they are just freely operating illegally, because there would be consequences, i.e. very heavy fines. Binance for example have withdrawn their application from Greece, and are actively seeking authorization from another jurisdiction.

My point is, i don't think any service would risk the penalties they could incur for operating illegally. So, it is either they are slowly winding down, or they suspend certain activities for EU users in their platform, while they work on getting licensed.

Well if Europe remains such a fractured landscape for financial services I'd say it's likely we're seeing precedent of services being like "come at me bro" because local countries might not be so hot to enforce European landscape because locally they don't care about the slap in the wrist fines so they keep operating

[zasad@]

EU's regulatory arm just ridiculed themselves.

They made it such a point to regulate crypto, sold licenses through national oversight authorities, and somehow exchanges that operate without a license are still operating with full bank access in the EU.

https://www.amlintelligence.com/2026/07/binance-mexc-and-htx-accessible-eu-users-mica-licences/

The exchanges that didn't end up getting a license just straight up ignored the lawfare and continue working and systemic means of payments such as banks and cards are very happy to keep processing payments for them also. The EU continues to vote on legislation it can't and is unwilling to enforce once again. This ends up being funny after a certain point.

The European Union is very large and highly bureaucratic. When large countries with strong economies introduce regulations, other countries look for loopholes to legally exploit them and make money.
While these new laws create problems for large exchanges, a complete blockade of exchanges is impossible.

[Minerall]

The Article 143 bit is missing from this.

Each member state could give incumbents up to 18 months from 30 December 2024 to keep operating under national rules while they applied. That's where 1 July 2026 comes from, and it was a hard ceiling — nobody could extend past it. Germany and France ran shorter windows, which is most of why implementation looks so patchy from outside.

So for a good chunk of the period you're describing, an unlicensed firm serving EU clients wasn't ignoring anything. It was grandfathered, lawfully, and the deadline simply hadn't landed yet.

The other half of it is what enforcement even looks like under an authorisation regime. It isn't fines. It's access. A firm either holds authorisation, or it stops taking EU clients, or it geofences them and says nothing about it. Only the first of those is visible from where we sit, so "they're still operating" doesn't tell you much in either direction. Z-tight has it right.

What I'd actually want to know is how many venues quietly shut the door on EU residents after 1 July. That number doesn't turn up in anyone's press release.

[zasad@]

The Article 143 bit is missing from this.

Each member state could give incumbents up to 18 months from 30 December 2024 to keep operating under national rules while they applied. That's where 1 July 2026 comes from, and it was a hard ceiling — nobody could extend past it. Germany and France ran shorter windows, which is most of why implementation looks so patchy from outside.

So for a good chunk of the period you're describing, an unlicensed firm serving EU clients wasn't ignoring anything. It was grandfathered, lawfully, and the deadline simply hadn't landed yet.

The other half of it is what enforcement even looks like under an authorisation regime. It isn't fines. It's access. A firm either holds authorisation, or it stops taking EU clients, or it geofences them and says nothing about it. Only the first of those is visible from where we sit, so "they're still operating" doesn't tell you much in either direction. Z-tight has it right.

What I'd actually want to know is how many venues quietly shut the door on EU residents after 1 July. That number doesn't turn up in anyone's press release.

What constitutes a violation on the part of the exchange?
Let's say the exchange doesn't have a license in Europe and doesn't actively advertise its services in the EU, but a European citizen found the platform and registered on their own.
Is this considered a violation on the part of the exchange if it doesn't have a license?

[Z-tight]

What constitutes a violation on the part of the exchange?
Let's say the exchange doesn't have a license in Europe and doesn't actively advertise its services in the EU, but a European citizen found the platform and registered on their own.
Is this considered a violation on the part of the exchange if it doesn't have a license?

I believe it would still be considered a violation of the extant regulation. Centralized exchanges collect kyc from their customers, so they know who their customers are, and without authorization, they shouldn't offer their services to European customers. However, i am sure penalties in such cases would be based on the scale of the violation, that is the number of customers the service have welcomed into their platform without a valid license to operate.

[zasad@]

What constitutes a violation on the part of the exchange?
Let's say the exchange doesn't have a license in Europe and doesn't actively advertise its services in the EU, but a European citizen found the platform and registered on their own.
Is this considered a violation on the part of the exchange if it doesn't have a license?

I believe it would still be considered a violation of the extant regulation. Centralized exchanges collect kyc from their customers, so they know who their customers are, and without authorization, they shouldn't offer their services to European customers. However, i am sure penalties in such cases would be based on the scale of the violation, that is the number of customers the service have welcomed into their platform without a valid license to operate.

I'm not an expert on interpreting the MiCA Regulation, but lawyers write about "Reverse Solicitation".

In the context of the MiCA Regulation, this means that if an EU citizen or company voluntarily contacts a foreign crypto exchange, the exchange has the right to provide the service. The law considers that in this case, it's not the exchange that has entered the European market, but the European citizen themselves who has "arrived" in a foreign jurisdiction.

I would like to get a legal reference from a European or someone who has looked into this situation.

[yhiaali3]

The question that comes to mind is, if these platforms (Binance, Mexc, and HTX) are not licensed in Europe, do the European authorities have the right to request that these platforms provide them with the data of European users? And what if these platforms refuse to provide this data? What can the European authorities do?

Since these platforms are not licensed in Europe and their offices are located outside Europe, what could compel them to cooperate with European authorities?

[bitbollo]

@yhiaali3
Some of these user data are already covered by the same EU laws on privacy since GDPR was already in place - I would request to delete my data if the account is already empty.
For what I have seen at least in Italy, they have shared in some cases user data if requested with a specific mandate - like related illicit or AML - even if exchange was not regulated in the country.
I would find impossible they actually need to follow a mandatory law for a market they are not serving.

[zasad@]

The question that comes to mind is, if these platforms (Binance, Mexc, and HTX) are not licensed in Europe, do the European authorities have the right to request that these platforms provide them with the data of European users? And what if these platforms refuse to provide this data? What can the European authorities do?

Since these platforms are not licensed in Europe and their offices are located outside Europe, what could compel them to cooperate with European authorities?

In Europe, there is a Directive on Administrative Cooperation 8, which obliges exchanges without EU licenses to transfer data to European regulators.

Mexc and HTX could refuse to transfer data to EU regulators, but then they would be subject to sanctions in Europe and would never be able to officially operate there. These exchanges will likely respond to requests to avoid losing access to the EU market in the future.

[Z-tight]

These exchanges will likely respond to requests to avoid losing access to the EU market in the future.

Yeah, because regulations and laws can change over time and these services know that. So, they wouldn't want to be completely barred from the European market, and maybe even have their app taken off App Store in the EU and their domain name blocked.

While these unlicensed services can technically refuse to comply with EU orders and law enforcement requests, i believe they would. They stand a lot to lose, E.G. if they have accounts in EU banks, it could be frozen, depending on the seriousness of the request, and there is also a possibility of their owners or executives being arrested and questioned if they land in the EU.

[CryptAlex-70]

A stupid situation. Those who don't understand how the system works are trying to regulate it.

Bitcoin cannot be regulated by laws. It is beyond the law and beyond the right.
No one has a right to a single Satoshi.

Bitcoin is a computational protocol. Computations using this protocol generate new computational capabilities.

Therefore, Bitcoin should be viewed as an opportunity to perform a computation.

It's good to have this opportunity, but you're poor if you don't have the secret number.

I would suggest ignoring any laws or regulations issued by the state authorities.
As for those who attempt to regulate blockchain operations through legislation, they should be isolated from society as dangerous lunatics.

[Z-tight]

Bitcoin cannot be regulated by laws. It is beyond the law and beyond the right.
No one has a right to a single Satoshi.

MiCA regulations is not about the BTC industry, it is a comprehensive framework designed for the crypto market in the E.U.. It covers Crypto Asset Service Providers and stablecoins, it really has nothing to do with BTC in itself.

I would suggest ignoring any laws or regulations issued by the state authorities.

That is not possible for centralized crypto services, if you want to operate in a particular jurisdiction, then you have to comply with their laws or face severe penalties. Right now, no CASP can offer their services to EU customers without a MiCA license.

[yhiaali3]

@yhiaali3
Some of these user data are already covered by the same EU laws on privacy since GDPR was already in place - I would request to delete my data if the account is already empty.
For what I have seen at least in Italy, they have shared in some cases user data if requested with a specific mandate - like related illicit or AML - even if exchange was not regulated in the country.
I would find impossible they actually need to follow a mandatory law for a market they are not serving.

Yes, that's my point of view too. Theoretically, there's no law requiring them to provide any information.

But on the other hand, as zasad@ and Z-tight@ said, these exchanges are likely to respond to requests to avoid losing access to the EU market in the future, or if they have accounts in EU banks, their funds may be frozen, or there could even be prosecutions and other measures.

[zasad@]

These exchanges will likely respond to requests to avoid losing access to the EU market in the future.

Yeah, because regulations and laws can change over time and these services know that. So, they wouldn't want to be completely barred from the European market, and maybe even have their app taken off App Store in the EU and their domain name blocked.

While these unlicensed services can technically refuse to comply with EU orders and law enforcement requests, i believe they would. They stand a lot to lose, E.G. if they have accounts in EU banks, it could be frozen, depending on the seriousness of the request, and there is also a possibility of their owners or executives being arrested and questioned if they land in the EU.

Let's look at the MiCA requirements for obtaining a license for a foreign crypto exchange:
These requirements effectively deprive you of the right to manage your exchange, as you must hire local AML officers, have an EU resident on the board of directors, and have a full European presence. After that, due to bureaucratic processes, the application will be reviewed for up to 12 months. This isn't business, it's politics.

[MadSl1m]

The enforcement people are looking for did happen, one layer down. MiCA bites the euro rails, not the offshore exchange. 

SpectroCoin paused new EEA registrations after 30 June 2026 while its CASP authorisation is pending. The Bank of Lithuania revoked Paytend Europe's e-money licence and the BingX card went dark. Poland's KNF pulled Quicko's payment-institution authorisation in January and the CEX.IO card died in February.

Nobody has to authorise a trade. The moment a euro or a card has to move, someone needs a licence, and that is where a regulator can actually reach.

[YOSHIE]

They made it such a point to regulate crypto, sold licenses through national oversight authorities, and somehow exchanges that operate without a license are still operating with full bank access in the EU.

I think every time new rules are developed, especially regarding crypto exchange licensing, there are coordination challenges, but it is not as easy as turning the palm of your hand to close and stop crypto exchanges operating in the European Union, When exchanges do not comply with enforced legal regulations, but they still operate, I don't think that lasts long.

If you are not mistaken, currently the European Union is actually preparing a strict legal framework for crypto asset service providers, those who operate are legally required to have an official license and when there are crypto asset services that do not comply over time, they will receive consequences based on applicable regulations, to coordinate and supervise almost 27 member countries with different bureaucracies is not an easy thing, so it is natural when we see that currently there are crypto services that do not comply with the law still operating in the European Union.