Binance ordered to cease crypto services in Belgium over allegations of violation of law

Binance has had a costly month as it continues to face regulatory crackdowns from all directions. The lawsuit from the United States Securities and Exchange Commission (SEC) has had an impact so severe that the crypto exchange is still reeling from it. If that wasn’t bad enough, now Belgium seems to have put the boot in as well.

Binance asked to halt services

Binance received an order from Belgium's regulatory body, the Financial Services and Markets Authority (FSMA), to halt offering crypto services on Friday. The company, according to FSMA, was in violation of the law as it was providing services in Belgium from countries outside the European Economic Area (EEA). 

These services included virtual currencies and legal currencies, as well as custody wallet services. As per the law of the country, no company based outside of EEA can engage in offering such services. Failure to comply with this prohibition can result in criminal sanctions on the prevention of money laundering and terrorist financing.

Iterating this, the FSMA, in its announcement of the order against Binance, noted,

"In addition to the order to cease their activities in Belgium immediately, the FSMA has demanded that Binance take immediate measures, after contacting their clients and taking into account any instructions the latter may give, to return to the Belgian clients in question all cryptographic keys and/or all virtual currencies that Binance holds for their account, or to transfer these to entities governed by the law of an EEA member state and duly authorized by their domestic law to carry out such activities, including within Belgium.

Binance has been facing regulatory crackdowns from multiple nations this month after the SEC filed a lawsuit against the exchange in early June. The exchange was alleged to be in violation of the law, although recent developments paint a different picture.

Earlier this week, Binance alleged that the SEC was providing misleading statements regarding whether it had commingled clients’ funds. The accusations were backed up by the SEC’s attorneys' testimonies, in which they admitted to not finding any proof of outflows from Binance-affiliated company BAM. In addition to the allegations, Binance stated,

"SEC's statement that Defendants have been able to commingle customer assets or divert customer assets as they please' is directly contradicted by the SEC's statements to the court that the SEC has no evidence of that ever occurring.

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