After MiCA deadline, majority of Binance users sent funds to self-custody not other compliant exchanges
Following MiCA's July 1 deadline, Binance reported approximately 70% of EU-withdrawn funds moved to self-custody wallets rather than regulated competitor exchanges. Only 30% went to MiCA-compliant platforms, suggesting users prioritized personal control over switching to authorized rivals. The unaudited figures lack key details, leaving uncertainty about whether the regulation succeeded in shifting custody or merely fragmented the market.
Key takeaways
- 1After July 1 MiCA deadline, approximately 70% of Binance EU withdrawals went to self-custody wallets, only 30% to regulated exchanges.
- 2Users prioritized personal control over switching to MiCA-compliant competitor platforms despite regulatory incentives offered.
- 3Binance's unaudited figures lack asset values, user counts, and tracking methods, leaving uncertainty about regulation's actual effectiveness.
Why it matters
For Indian investors, this shows how strict crypto regulations may drive users toward self-custody rather than regulated platforms, fragmenting markets and reducing exchange liquidity. It signals that regulatory compliance alone cannot guarantee user adoption if it means losing established platforms, a precedent relevant as India shapes its own crypto framework.
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