In October 2023, EUR-denominated weekly spot volume on Binance, a top cryptocurrency exchange, fell to $160 million, an 88% drop from $1.3 billion recorded seven months earlier in March 2023. At this level, EUR trading volume on the besieged exchange is at a three-year low, pointing to how consequential the decision by regulators to crack down on the platform has been this year. 

Blame Paysafe For Plunging EUR Volume?

According to Kaiko, on October 18, the contraction was worsened by Paysafe’s decision to terminate its partnership with the exchange by the end of September 2023. 

Following this move, clients in the European zone had no options to swap their tokens for Euro. Instead, they had to exit to other cryptocurrencies, mostly the USDT and Bitcoin (BTC), two of the zone’s most liquid assets supported by the exchange’s subsidiaries.

Paysafe didn’t explain why they were terminating their collaboration with Binance. However, considering the increased regulatory pressure on crypto exchanges, especially by agencies in the United States and Europe, Paysafe likely wanted to play safe and not damage its reputation by being associated with the on-siege exchange. 

Additionally, with the Markets in Crypto-Assets Regulation (MiCA) set for implementation in the coming months, crypto exchanges must comply with complex regulations to increase transparency and protect users. Subsequently, Paysafe might have found it challenging to comply with all expected regulations while servicing Binance, necessitating the pullout.

Binance Pulling Out From
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Author: Dalmas Ngetich

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