Binance Is “For The Long Term” When It Comes To Europe And Doesn’t Fear The Crypto Crash
As the crypto winter sends a chill through the markets, with the price of Bitcoin crashing below With the key $20,000 (€19,000) threshold and crypto exchanges laying off staff for fear of a recession bite, the world’s largest crypto exchange says it’s all already seen and not concerned.
“It’s an early industry and we’ve been through these cycles before. And I think that’s kind of a natural part of this industry,” said Martin Bruncko, Binance’s Executive Vice President for Europe, in an interview with Euronews Next at this year’s VivaTech conference in Paris. .
Bruncko admitted that while it’s “very sad” to see companies go bankrupt and people lose money, these lower parts of the crypto price cycle can also spur innovation.
“Anytime you have a crash, even in the normal tech industry, usually great things come out of it,” he said.
“And by the way, some of the biggest companies like Facebook and LinkedIn are companies that were all created in the first big internet crash of 2001. So I think that’s kind of a cathartic event for the industry as well “.
It’s a surprisingly different picture painted compared to competitor Coinbase.
It was announced last week that it would lay off a fifth of its workforce due to a possible recession, a need to manage costs and growing “too fast” during a bull market, according to an email sent by CEO Brian Armstrong to employees.
Binance takes over the City of Lights
Binance, on the other hand, spends a lot, especially in Europe.
The Chinese company announced in April that it would help build Web3 and blockchain projects at Station F – the Parisian start-up incubator – as part of a €100 million injection into France, an initiative dubbed ObjectiveMoon.
The selected start-ups will be hosted for free at Station F and will be able to benefit from Binance subsidiaries.
Binance has also chosen Paris as its European hub and is expanding its office in the French capital from 50 employees to 250.
This comes as the company obtained regulatory approval in May to provide digital asset services in France, the first European country where it has obtained such authorization.
“[Regulation in France] allows us to be a fully regulated and supervised entity. So it’s just a base,” Bruncko said.
“Now, with his foundation, we can start building much more, both for customers, for France and the French economy in the French tech ecosystem.
“We are very, very lucky to have a little magnet effect in the crypto industry. So generally when we go somewhere we can bring a lot of that ecosystem with us and a lot of ecosystems follow that.”
However, some criticized Binance and French regulators for granting Binance approval far too easily.
France’s stock market watchdog, the Autorité des Marchés Financiers (AMF), which granted the license, does not – according to some experts – address issues such as business conduct regulations, fairness, prudential requirements, consumer protection and the issue of transparency.
When asked if France granted Binance regulation too easily, Bruncko replied, “That is absolute nonsense and it seems a very unfair accusation.”
He said that Binance has been engaged with the AMF for two years and “it’s not something we were just given”.
“The French government has been very clear with us throughout this process: as enthusiastic as they may be about any interesting technology coming to France, the most important thing for France is the signature of the French state. They will only do this if they are 100% sure that this entity actually meets all the criteria,” he said.
“There was absolutely no special treatment,” he added.
Binance flexes its muscle in Europe
Binance does not intend to stop in France; it fully aims to become pan-European.
The company recently received regulatory approval in Italy and plans to spread its wings to Spain, Portugal, Slovakia, Bulgaria, Romania and the Nordics.
“I’m super excited about this because I think there’s so much potential for Web3 and generally for technology in Europe,” Bruncko said.
“As Europeans, we are doing very well in keeping up with the Americans and China in technology. And I think it’s a great opportunity for Europe to really take the lead for once,” he added.
“And I think and hope that Binance can really contribute significantly to what we’re trying to do with what we’re trying to do in Europe.”
European Union regulators could also finalize a crypto bill this month. The Crypto-Asset Markets Bill (MiCA) has been trading since 2020 and aims to shape the development of crypto in the European common market.
Bruncko said Binance welcomes him and he can’t come soon enough.
“The ultimate goal of MiCA is to create a single crypto and blockchain marketplace,” he said.
“And we have seen it time and time again over the last 40 years that Europe can only be competitive if there is a single market, a real single market. So we are very much in favor of it. In fact, we are pushing for MiCA to come in force more quickly”.
Get hard on Russia
One of the EU’s ambitions is to crack down on the use of cryptos for hacks and fraud, something Binance has come under fire for since a Reuters investigation found Binance had in the past processed transactions totaling at least $2.35 billion (€2.22 billion) from hacks, investment fraud and illegal drug sales.
“We have always put customer protection first, always. And we have always been careful to comply with all rules and regulations, including those relating to money laundering. It’s actually been massively beefed up since last year,” Bruncko said, adding that he has senior staff working in this area, including some who previously worked at Europol.
To be a Binance customer, you must pass several checks and you cannot be a politically exposed person (PEP).
“We were actually ahead of the curve, even ahead of the EU at times in terms of relocating people who we thought were at high risk from a money laundering or corruption perspective,” Bruncko said. .
“Interestingly enough, we didn’t exclude a lot of people at the start. And you might ask, well, that’s bad. Actually no. The reason we haven’t banned a lot of people is that we didn’t allow them on the platform in the first place.”
He said that when new sanctions were imposed on Russia for its invasion of Ukraine, Binance banned the accounts even before people were on the sanctions list, which included two daughters of Russian government figures, who could not be named due to legal reasons.
“One of them, we removed two weeks before she was placed on a sanctions list. The second, we landed within 4 hours of her being placed on a sanctions list. sanctions because she was already on our watch list,” Bruncko said.
“The Long Game”
Crypto regulation is also likely to increase since so-called stablecoin TerraUSD and its sister token Luna crashed.
Binance, however, says it has measures in place to prevent its customers from losing everything.
One initiative is the Responsible Trading Policy, which, much like the Responsible Kid Policy, uses a system, especially for new users, to give them a cooling off period if they lose money very quickly.
“You could say it’s against your interests. You know, you might make some money,” Bruncko said.
“But if people lose money in the short term because they’re not properly educated because they don’t have the right skills, that not only creates real human tragedies, it actually creates bad printing and bad public relations for the industry.
“I think in that sense we’re really in for the long haul,” he said.