A recent report suggests that Binance secured a crypto license in Dubai, coinciding with the departure of Changpeng Zhao (CZ), its CEO.
Obtaining the complete regulatory license could be a game-changer for Binance, which has faced rigorous regulatory scrutiny for a minimum of two years.
Binance, recognized as the largest cryptocurrency exchange globally, finally secured a regulatory license in Dubai, a development eagerly awaited by the industry.
According to a report on April 18, Binance CEO Richard Teng disclosed that Binance obtained its Virtual Asset Service Provider (VASP) license after co-founder Changpeng Zhao relinquished his voting power within the exchange’s local entity.
Per the report, unnamed sources familiar with the matter revealed that the final condition set by the Virtual Assets Regulatory Authority (VARA) for issuing the VASP license was for CZ to relinquish his voting rights in Binance FZE, the Dubai-based arm of the exchange.
Securing the complete regulatory license represents a notable victory for Binance, which has faced regulatory scrutiny since the collapse of FTX.
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Binance struck a decisive deal with United States authorities in November 2023, agreeing to a staggering $4.3 billion settlement to resolve allegations of AML violations and breaches of the Bank Secrecy Act.
As part of a plea deal, Binance co-founder Zhao admitted guilt to one felony count, specifically for inadequate Anti-Money Laundering (AML) protocols, and stepped down from his position. CZ’s sentencing is scheduled for April 30, with a potential prison term of up to 18 months.
Dubai’s Virtual Assets Regulatory Authority (VARA) aimed to avoid disrupting Binance’s recent agreement with U.S. regulators, which resulted in CZ resigning from his role as Binance’s CEO.
The primary motive behind VARA’s demand for CZ to relinquish his voting authority in Dubai FZE was to ensure compliance.
Even though his voting privileges have diminished, Zhao still retains ownership of Binance FZE’s parent company in Abu Dhabi.
In September 2022, VARA granted Binance a preparatory minimal viable product license, allowing the exchange to provide various digital asset services tailored for eligible retail and institutional investors.
