FRANKFURT - German regulators have told Binance they will not grant it a cryptocurrency custody licence, a person with direct knowledge of the matter said on Thursday, the latest in a string of setbacks for the world's biggest cryptocurrency exchange.

Binance has come under pressure from regulators around the world. The U.S. Securities and Exchange Commission this month sued Binance and its CEO Changpeng Zhao over what the regulator called a "web of deception" to evade U.S. laws. Binance denies the charges.

The German regulator, BaFin, issued a statement declining to comment on individual companies due to confidentiality.

Binance said it would not share details of conversations with regulators, but added: "We continue to work to comply with BaFin's requirements".

It called it a "detailed and ongoing process" and said it was confident of having "the right team and measures in place to continue our discussions with regulators in Germany".

Finance Forward first reported the news of the German licence.

Problems have been mounting for Binance in recent weeks.

Last week, Belgium's FSMA regulator ordered Binance to stop offering any virtual currency services in the country.

France is also probing Binance, which has decided to quit the Dutch market because it was unable to meet registration requirements to operate as a virtual asset service provider.

BaFin in 2021 warned Binance it risked being fined for offering certain digital tokens to clients in Germany without necessary information.

(Reporting by Tom Sims and Tom Wilson; Editing by Sabine Wollrab and Mark Potter)