Media reports suggest that Binance has made some regulatory progress by securing approval in Dubai after a period of significant instability for the company.
Both Bloomberg and Coinbase have reported that the company has been granted a virtual-asset services provider (VASP) licence by the emirate’s Virtual Assets Regulatory Authority (VARA).
Binance CEO, Richard Teng, said: “As we secure the esteemed full market VASP Licence, it notably amplifies our unwavering commitment to advancing the financial landscape through compliance and innovation.
“This achievement embodies our dedication to transparency, regulatory compliance, and responsible growth in the dynamic digital assets domain.”
This is subject to certain conditions, however, with the most notable relating to the controversies Binance has found itself embroiled in over the past year.
Bloomberg outlined that Dubai officials granted the permit once Co-Founder Changpeng “CZ” Zhao agreed to give up voting control in crypto exchange’s local operation, Binance FZE.
Zhao has been at the centre of controversies surrounding Binance, and the many regulatory concerns that have arisen as a result of this. He was forced to step down from the company’s board after pleading guilty to breaching the Bank Secrecy Act (BSA).
As a result he was also fined $50m. This all fell within the remit of a wider US government investigation into Binance, which saw the firm charged with breaking US money laundering rules, leading to a record $4.3bn settlement fee.
Binance remains the world’s largest cryptocurrency exchange in terms of daily trading volume of cryptocurrencies, but the months following the firm’s settlement and Zhao’s trail have seen it hit some regulatory and business hurdles.
For example, as recently as February the company found itself facing difficulties relaunching in the UK due to local partners’ reluctance to work with the company in the aftermath of legal drama.
The firm’s launch in Dubai will come as a significant boost to both the company’s business and the confidence of its leadership. For Dubai, meanwhile, the licence signifies the heavy emphasis the city is increasingly placing on fintech and financial services as part of its economy.
The city’s authorities have been active in issuing VASP licences, such as to DKK Partners FZE in February and OKX in January. Crypto.com, also one of the world’s biggest crypto exchanges, is also making progress towards launching in the city.
According to Coinbase, Binance FZE General Manager. Alex Chehad. stated that the licence “underlines Dubai’s position as a forward-thinking city – acknowledging and embracing the financial potential that blockchain technology brings”.
