French authorities have launched a judicial investigation into Binance, the world's largest cryptocurrency exchange, over allegations of money laundering, tax fraud, and connections to drug trafficking. Conducted by the Paris Public Prosecutor's Office (JUNALCO), the investigation highlights serious concerns regarding Binance’s compliance with regulatory standards in France and across the European Union. The probe spans activities from 2019 to 2024, focusing on unlicensed operations and misleading information provided to users, many of whom reported significant financial losses.

Key Allegations and Investigations in France

This investigation is not the first time Binance has faced scrutiny in France. In 2023, French prosecutors examined claims of illegal customer recruitment and money laundering. They also alleged that Binance marketed its services to French users before obtaining the necessary licenses in May 2022. The platform is accused of insufficient anti-money laundering controls and noncompliance with France’s stringent regulatory standards, including operating without proper approvals during the investigation period.

Additionally, authorities are assessing whether Binance facilitated transactions tied to criminal networks, further amplifying concerns about its operational transparency. The investigation aligns with growing regulatory pressure across Europe, where Binance has faced challenges in multiple countries, including license withdrawals in the Netherlands, Belgium, the UK, and Germany.

Binance’s legal troubles are not confined to France. In January 2025, the U.S. Supreme Court allowed a lawsuit against Binance and its founder, Changpeng Zhao, to proceed. This case involves allegations of selling unregistered tokens, many of which later plummeted in value. Similarly, in December 2023, Australia’s corporate watchdog sued Binance’s local derivatives business for misclassifying retail customers as wholesale investors, denying them key consumer protections.

International Operations and Money Laundering Schemes

Adding to the complexity of global crypto crime, European law enforcement recently dismantled an organized criminal group involved in laundering over €100 million using cryptocurrency. This operation, led by Eurojust in collaboration with authorities from Spain, Cyprus, Germany, and France, exposed sophisticated laundering techniques, including the physical transportation of cash and regular crypto transactions. Over €27 million in cryptocurrency was frozen, and 23 arrests were made across Europe.

While Binance is not directly implicated in this case, the growing prevalence of crypto-related money laundering highlights the critical need for robust anti-money laundering protocols across the industry.

The Bigger Picture: Regulatory Implications for Binance

Binance has historically viewed France as a strategic hub for its European operations. Its leadership has praised France's regulatory framework as a cornerstone for expansion. However, the ongoing investigations and allegations have cast doubt on the exchange's compliance with European standards, particularly under the upcoming Markets in Crypto-Assets (MiCA) framework.

Questions regarding Binance’s governance, anti-money laundering protocols, and overall user security are now under heightened scrutiny. A criminal conviction or regulatory setback in France could jeopardize Binance’s ability to operate across Europe, complicating its path to single-market authorization under MiCA.

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