Cryptocurrency exchange Binance said it will leave the Netherlands after the company’s application to register under the Dutch crypto authorization regime was rejected.
Referring to a virtual asset service provider, Binance on Friday said that it could no longer serve Dutch clients “as we have been unable to register as a VASP with the Dutch regulator.”
The company didn’t give a reason for why it was unable to receive a license from regulators.
Starting Friday, no new Binance users will be accepted onto the platform. From July 17, Binance said it will cease allowing users to buy tokens, trade, or make deposits, although its withdrawal function remains active.
Binance recommended that users withdraw their assets from their accounts.
The Dutch central bank, which is responsible for authorizing new virtual asset services providers, was not immediately available for comment.
Under the current regulatory regime, Binance can only get approval to operate in an EU country by registering under its money laundering prevention rules.
The firm has so far received such approvals in France, Italy, Spain, Poland, Sweden and Lithuania. This is set to change once the EU approves its Markets in Crypto Assets (MiCA) regulation.
MiCA aims to harmonize crypto regulation across the bloc and to prevent bad actors from harming consumers, particularly in the wake of the shock bankruptcy of FTX in November.
Once MiCA comes into force, crypto firms with registration in one EU country will be able to then use that to offer their services across other member states.
Binance said it remains “committed to working collaboratively with regulators around the world and are additionally focused on getting our business ready to be fully MiCA compliant.”
“Existing Dutch resident users are being sent an email with comprehensive information about what this means for their accounts and any assets they currently have on the Binance platform, alongside any steps they will need to take,” a Binance spokesperson told CNBC.
“While Binance is disappointed that this has become necessary, it will continue to engage productively and transparently with Dutch regulators.”
The latest blow to the crypto giant follows a tumultuous few months for the broader cryptocurrency industry. Last week, the U.S. Securities and Exchange Commission sued Binance and CEO Changpeng Zhao, alleging that they engaged in the unregistered offer and sale of securities and commingled investor funds with their own.