Binance obtains virtual asset service provider license in Dubai

Binance Holdings Ltd., the world’s largest digital asset exchange, has obtained a Virtual Asset Service Provider (VASP) license in Dubai after co-founder Changpeng “CZ” Zhao agreed to give up his voting control in the local entity, according to people familiar with the matter not identified in the Bloomberg report.

This long-awaited license is a significant win for Binance, which has faced a series of regulatory challenges over the past two years. The exchange was forced to pay $4.3 billion in penalties to U.S. authorities in November, and as part of the deal, Zhao was required to step down as CEO.

The VASP license allows Binance to offer a broader range of services to customers in the emirate, including retail cryptocurrency trading. Prior to this, Binance’s local unit, Binance FZE, had held “Operational MVP” licenses for broker-dealer and exchange services since mid-2023.

One of the final conditions set by the Virtual Assets Regulatory Authority (VARA) before granting the full VASP license was for Zhao to relinquish his voting control of Binance FZE. Officials wanted to ensure that the Dubai operations would align with the agreement Binance reached with U.S. authorities, under which Zhao was forced to resign as CEO.

After resolving the issue of Zhao’s voting control, Binance and VARA conducted a comprehensive review of the products the exchange plans to offer in Dubai. The billionaire Zhao remains the ultimate beneficial owner of Binance FZE’s Abu Dhabi-based parent company, according to the people familiar with the matter.

The VASP license comes as Binance’s smaller competitors, such as OKX and Crypto.com, have already obtained the coveted status, allowing them to serve a broader customer base in Dubai.

Binance’s new CEO, Richard Teng, has vowed to improve the company’s compliance and relations with regulators worldwide. In the past year, several countries, including India and Belgium, have taken steps to prevent Binance from operating locally without the necessary approvals.

Teng has stated that Binance, which does not have a formal headquarters, is in discussions with various jurisdictions about potentially serving as a global base for the company.

The report follows a Binance executive and another company official being detained in Nigeria in mid-March. The company subsequently requested the release of the company officials earlier this month.

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