Binance Users in Europe Will No Longer Access Exchange’s Copy Trading Service: Here is Why
The world’s biggest cryptocurrency exchange by trading volume, Binance, announced a few weeks ago that it would block European users from accessing its copy trading platform following a regulatory change in the European Union (EU) region.
In its announcement, Binance advised copy traders and impacted lead traders to close their trades and transfer their capital to their spot wallets before July 10th. The exchange’s move to limit Europeans’ access to copy trading services is fueled by the introduction of the MiCA regulatory framework, which became effective earlier this month.
“Do not Deposit Non-Compliant Stablecoins,” Binance Warns European Users
The new crypto rules in Europe mean that Binance users in that region can no longer trade or deposit stablecoins, which are not regulated under MiCA. For this reason, the centralized exchange has advised European users to convert their stablecoin holdings to other assets in order to comply with MiCA laws.
It is worth pointing out that the implementation of MiCA has also forced Binance to change its referral and reward systems for Europeans. Instead of receiving referral rewards in stablecoins, users in Europe will be rewarded with BNB, the native token of Binance.
What is MiCA?
Markets in Crypto Assets or MiCA was signed into law last year. It is a regulation framework for digital assets in the European Union, offering much-needed legal clarity for crypto players.
Besides ensuring that crypto firms operate in a regulated environment, MiCA plays a key role in protecting digital asset investors and preventing illegal financial activities by making sure that involved parties comply with anti-money laundering policies.
MiCA has been welcomed by many crypto gurus who believe it will promote blockchain innovations in the EU. While praising EU policymakers for voting in favor of MiCA, the CEO of cryptocurrency exchange YouHodler, Ilya Volkov, advised crypto platforms on July 5th to migrate from stablecoins that do not comply with MiCA laws in order to serve European crypto users.
It is important to mention that since MiCA is implemented by all EU member states, then any crypto firm that obtains a license in one European country is allowed to serve users in other EU countries.