Crypto exchange Binance is under investigation by French authorities for alleged illegal practices. The exchange recently underwent an on-site visit by regulators, which is a standard regulatory obligation for financial institutions in France. However, Binance declined to provide specific details regarding the investigations or any potential law enforcement involvement. This probe in France adds to the growing list of regulatory challenges faced by Binance globally, as watchdogs intensify their scrutiny of the cryptocurrency industry.

In addition to the French investigation, Binance announced its departure from the Netherlands after failing to register with the country's financial authorities. The exchange stated that it couldn't obtain registration as a virtual asset service provider, despite exploring alternative avenues to comply with Dutch regulations. These setbacks reflect the mounting pressure faced by Binance from regulatory bodies around the world.

The United States Securities and Exchange Commission (SEC) has also filed a lawsuit against Binance and its CEO Changpeng "CZ" Zhao, alleging mishandling of customer funds, misleading investors and regulators, and violation of securities rules. This legal action follows a previous lawsuit from the US derivatives watchdog in March, which accused Binance and Zhao of routinely breaking its rules. Binance has expressed disappointment with these actions and vowed to defend itself against the allegations.

Although Binance does not have a defined global or regional headquarters, it chose Paris as its European hub last year and received a digital-asset service provider registration from the French markets authority AMF. The decision to establish its European base in Paris was seen as a victory for the French government's efforts to position the capital as a hub for cryptocurrency and fintech companies. Binance has made significant investments in France, creating over 150 permanent positions and contributing €100 million to the nation's blockchain ecosystem.

The regulatory landscape for cryptocurrencies in Europe is evolving, with the recent approval of the EU's Markets in Cryptoassets (MiCA) law. This legislation represents the first comprehensive set of rules for the crypto industry in the European Union. It marks a significant step towards government supervision of the nascent industry, following the collapse of major participants like the crypto exchange FTX. Bank of France Governor Francois Villeroy de Galhau emphasized the need for international cooperation to regulate crypto conglomerates, suggesting that a new version of the EU regulation, "MiCA 2," may be necessary to address these firms.