European police say Binance's April 2025 policy asking law enforcement to route certain requests to foreign government agencies hinders criminal investigations
Investigators in Europe said that the cryptocurrency giant Binance had made it more difficult to track down scammers and solve other crimes.
Context & Ripple Effects
European investigators’ complaint extends a long-running compliance narrative around Binance. Earlier reporting found the exchange withheld information from regulators while maintaining weak customer checks, while U.S. scrutiny had already broadened across several enforcement fronts.
The issue is now operational rather than only regulatory: a policy governing where police must send requests can determine how quickly investigators can trace suspected criminal activity. Binance disputes that it changed its practices or added freeze requirements.
First-order effects
- European police agencies face additional routing steps for certain Binance information requests, which they say delays scam and other criminal investigations.
- Binance’s law-enforcement cooperation procedures become a fresh point of contention with European authorities, alongside its contested MiCA licensing efforts.
Second-order effects
- Delays in obtaining exchange records can increase pressure on investigators to use alternative channels and on Binance to demonstrate that its request-handling process does not impede active cases.
- The complaint reinforces regulators’ focus on whether exchanges’ stated compliance commitments translate into usable cooperation in practice, echoing the earlier expectation of penalties to resolve U.S. investigations.
Third-order effects
- If authorities increasingly treat cross-border request routing as an enforcement obstacle, crypto platforms may face more standardized expectations for direct, timely law-enforcement access.
- The episode fits a broader test of whether major exchanges can close the gap between compliance claims and regulator access, a factor in crypto’s institutional legitimacy.
The trend: Crypto regulation is shifting from assessing written controls to testing whether platforms’ operational processes enable effective enforcement across borders.