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French authorities have deepened their investigation into Binance on suspicion the world’s largest cryptocurrency exchange broke European money laundering and terrorist financing laws.
The public prosecutor said on Tuesday it had opened a judicial investigation into Binance as it was “likely to have assisted in habitual money laundering . . . in particular drug trafficking and tax fraud.”
The potential offences were “committed in France but also . . . in all countries of the European Union”, it added.
Its move is an expansion of a probe that began in France in 2023 over whether Binance marketed services to consumers without regulatory approval, among other allegations.
The exchange sought to draw a line under its past in late 2023, when it was fined a record $4.3bn by US officials in 2023 for failing to take measures against money laundering and breaches of international sanctions.
Its co-founder, Changpeng Zhao, stepped down at the time as chief executive, and spent four months in prison. Richard Teng, Binance’s new chief executive, vowed to enhance the company’s compliance controls.
“Binance fully denies the allegations and will vigorously fight any charges made against it,” the company said, adding that it was “deeply disappointed” that the matter “which is several years old” is being further investigated by French authorities.
The French probe relates to activities from 2019 to 2024, after users complained about losing money through investing on the exchange because of incomplete disclosure.
Prosecutors said the company “sent promotional communications” to users in France “via influencers and advertising campaigns on social networks” before Binance was registered with regulators, in breach of the law.
Several years ago, French officials sought to woo Binance and Zhao in order to place the group’s European headquarters in Paris as part of President Emmanuel Macron’s push to make the country more tech friendly and boost the attractiveness of Paris as a financial hub.
Macron met with Zhao at the Élysée Palace in late 2021. Binance’s services are still available to French customers.
In 2022, France was also one of the first countries in Europe to give Binance a registered status that allowed it to market some services to French consumers, alongside other crypto platforms.
The country’s more accommodating stance contrasted with wariness from regulators in the UK and elsewhere.
Binance has repeatedly clashed with the UK’s Financial Conduct Authority, which in 2023 blocked its attempts to market to British consumers.
The public prosecutor said it had handed over the investigation to France’s consumer protection and anti-fraud agencies.
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