EU Banking Authority Details Major Crypto Fines Under MiCA

The European Banking Authority laid out a sweeping framework Friday to penalize crypto issuers that violate the EU’s MiCA regulation.

The June 26 consultation paper sets a two-step process for fines, first assessing the severity of a violation, then weighing aggravating or mitigating factors. Final penalties could hit statutory caps of 12.5% of annual turnover for significant asset-referenced token issuers and 10% for significant e-money tokens, or double the profits generated by the violation.

The move sharpens enforcement under MiCA, the world’s first comprehensive crypto regulatory regime, which requires issuers and service providers to meet bank-like compliance, consumer protection and capital reserve standards to access the EU market.

Binance Pauses EU Operations Ahead Of Deadline

The framework arrives just days before the July 1 licensing deadline, after which firms without authorization risk being forced to halt operations. Binance, the world’s largest exchange, already notified EU users it will restrict key services after failing to secure MiCA authorization in time, having withdrawn its license application in Greece. New EU user onboarding will pause, though withdrawals remain available. Binance saw $1.96 billion in net outflows the day after its announcement, followed by $2.52 billion and $1.46 billion over the next two days.

EU Takes A Different Path Than The US

The EU’s move highlights its push to become the global standard-setter for digital finance, contrasting with the US’s regulation-by-enforcement approach. Industry players have until September 28 to lobby for changes to the EBA’s methodology, though firms must navigate the tighter rules well before then.