Belgium’s financial markets watchdog has ordered the cryptocurrency exchange, Binance to immediately quit offering its digital asset exchange and custody services in the country. The regulator also instructed the exchange to return all customers’ crypto holdings and keys.

Belgium Gives Binance Quit Notice

The Financial Services and Markets Authority (FSMA) issued the order on Friday, noting that the crypto exchange has been serving customers in the country from nations that are not members of the European Economic Area (EEA). It added that Binance does not dispute offering such a service in Belgium.

According to the watchdog, 27 companies, which it has called ‘Binance Operators', are engaged in providing operational and or technical support for Binance’s crypto exchange and custody services to Belgian clients. However, despite several requests, the exchange has failed to show that 19 of these entities “are in fact based in the European Economic Area and are authorized, based on their domestic laws, to provide such services in Belgium,” the FMSA noted.

“Persons or firms governed by the law of a country that is not a member of the European Economic Area are prohibited from offering or providing, within Belgium, by way of a professional activity – even if supplementary or ancillary – exchange services between virtual currencies and legal currencies or custody wallet services,” the FSMA explained.

Instead of returning all Belgian customer assets, Binance can opt to transfer them to entities that are regulated under the law of an EEA member state, the financial markets supervisor said. Additionally, these entities have to be authorized by domestic laws in their states to carry out crypto exchange and custody services, including within Belgium.

Furthermore, the FSMA urged Binance to “take every precaution that may be useful to guarantee the security of such transfers.” It also warned the exchange that Belgium's Chief Prosecutor had been briefed about the case, and it will pursue criminal sanctions under Belgium’s law on the prevention of money laundering and terrorist financing if Binance fails to heed the order.