Binance gets Dubai crypto license following CZ launch: Report

Binance, the world's largest cryptocurrency exchange, has received the long-awaited regulatory approval in Dubai.

Binance acquired its virtual asset service provider (VASP) license after co-founder Changpeng Zhao relinquished voting power in the local body of the exchange, anonymous people familiar with the matter told Bloomberg on April 18.

The final requirement for the Virtual Asset Regulatory Authority (VARA) to grant a VASP license was for Zhao to relinquish his voting rights in Binance FZE, a division of the Dubai-based exchange, said people familiar with the matter on condition of anonymity.

While Binance's current CEO, Richard Teng, confirmed that he had obtained the license, Zhao relinquishing his voting power is “pure speculation,” he said in a statement shared with Cointelegraph.

“That is pure speculation. Again, we don't comment on media speculation… Our relationship, our relationship with regulators is confidential.

The full regulatory approval marks a significant victory for Binance, which has been under regulatory scrutiny since the FTX collapse.

In the year In November 2023, Binance agreed to pay US authorities a $4.3-billion settlement to settle federal charges related to a lack of anti-money laundering (AML) protocols that violated the Bank Secrecy Act.

Binance co-founder Zhao pleaded guilty to one felony count of failing to meet adequate AML protocols and resigned as part of a plea deal. Zhao's sentencing is set for April 30. He faces up to 18 months in prison.

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Why did Binance's Dubai division cut ties with Zhao?

Dubai's VARA officials sought to prevent Binance from interfering with its recent settlement with US authorities, forcing Zhao to step down as Binance's CEO.

This was the main reason why VARA needed to give Zhao its voting power in the Dubai FZE. After Zhao was given the reins, Vara took a closer look at the products he planned to offer on the Dubai exchange, people familiar with the matter said.

Despite relinquishing voting rights, Zhao remains the ultimate beneficial owner of Binance FZE's Abu Dhabi-based parent company.

Achieving full authorization in the UAE remains a focus point for Binance's future operations, Binance Dubai General Manager Alex Chehadeh told Cointelegraph:

“Binance's senior leadership in the United Arab Emirates said they want to establish the region as a focal point for Web3. They're trying to move away from fossil fuels, and they've seen it.” [crypto] As a great driver to do so.

Binance received a Preparatory Minimum Viable Product License from VARA in September 2022, enabling the exchange to offer a range of digital asset services to qualified retail and institutional investors.

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