Regulation
Binance Disables Copy Trading for EU Users Ahead of MiCA
Binance, the world’s largest cryptocurrency exchange by trading volume, has disabled copy trading services for its European users as the implementation of Market in Crypto Assets (MiCA) regulation approaches.
This regulatory change, which is expected to come into effect at the end of June, signifies a substantial change in the European Union (EU) crypto environment.
To date, European Binance users have found a message on their mobile app informing them that the copy trading service is no longer available in their region. Prior to this, Binance had warned its users about “affected Lead Traders and Copy Traders”.
The exchange advised them to close their positions in copy trading assets and transfer their funds back to their respective spot wallets by the deadline of June 27, 2024 at 20:59 UTC. After this date, all remaining open positions will be automatically closed at the market price and the assets will be transferred to spot portfolios.
To know more: What are Cryptocurrency Markets (MiCA)?
Binance Notification on Copy Trading Restrictions in the EU. Source: Binance
BeInCrypto has contacted Binance regarding this issue. However, at the time of publication, we have not yet received a response.
This development came after Binance’s announcement new rules on stablecoins not approved in the EU on June 21st. Starting June 30, users will not be able to trade, deposit or withdraw stablecoins that do not follow MiCA guidelines.
“Stablecoins not authorized by MiCA, including USDT and others, will continue to be available for trading on Binance on Spot, for deposits and withdrawals, and in your wallet as usual. They will also be available for sale on Convert. Binance will not phase out these stablecoins,” the email announcement read.
The exchange has also changed its rewards and referral systems. Effective June 24, spot and margin trading referral fees will be paid BNB, Binance’s native tokeninstead of stablecoins. As such, Binance advised its European users to review their holdings and consider transitioning to regulated stablecoins or other digital assets before the June 30 deadline.
The MiCA regulation sets new standards for crypto assets in the EU
Introduced in 2023, MiCA is the first explicit regulation for cryptocurrencies in the EU, offering legal clarity to interested parties. Classifies digital assets, specifies applicable laws, and designates responsibility for enforcement.
This regulation addresses regulatory issues, ensuring a level playing field for crypto institutions in the EU and eliminate regulatory fragmentation between Member States. It also protects investors, prevents fraud and ensures compliance with anti-money laundering (AML) and financial laws.
Industry experts see MiCA as a revolutionary step in creating a consistent set of regulations for crypto assets across the continent. Mohsin Waqar, CEO of Web3 game Senet, believes that unified regulatory frameworks like MiCA could reduce fragmentation and promote a stable environment.
Ilya Volkov, CEO of the YouHodler crypto platform, also shared a similar sentiment. Despite the challenges surrounding the stable currency According to the new regulation, Volkov believes that Web3 and crypto platforms should migrate from non-compliant stablecoins to those that meet MiCA standards. However, he believes that MiCA is on the way out a precedent for the international regulation of cryptocurrenciesserving as a model for other regions.
To know more: Stablecoin regulations around the world
“Countries in Latin America and Asia will adopt similar approaches in the near future,” he told BeInCrypto.
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