Binance, the world’s largest crypto exchange, has been under a lot of pressure lately, but things are starting to turn around. It is the first crypto exchange to receive an operational Minimum Viable Product (MVP) license from Dubai’s Virtual Assets Regulatory Authority (VARA).
The license is granted to the exchange’s Dubai subsidiary, Binance FZE. The MVP license allows Binance to offer services, such as exchange and broker facilities.
Binance has been working on this since 2022
Binance has been trying to comply with the local regulators since 2022. It received a provisional MVP license in March and a preparatory MVP license in September.
By acquiring an operational MVP license, Binance can now offer services as a virtual asset (AKA Crypto or digital assets) exchange and as a virtual asset broker and dealer.
According to Binance, this shows the company’s dedication to complying with Dubai’s regulatory framework.
Richard Teng, Head of Regional Markets at Binance, said,
“We are honored to be the first exchange to be granted an operational Minimum Viable Product License by VARA — a result of over a year of due diligence, collaboration, and consistent demonstration of responsible intent – that now allows us to be able to leverage the potential of a progressive regulatory framework, enabling innovation while furthering user protection.”
What Can Binance Do?
At the moment, Binance can only offer its service to institutions and qualified retail investors. And those who qualify can safely convert their digital assets to fiat. Investors who use the service are protected under the standards set by VARA.
Aside from virtual asset exchange services, Binance can also custody and manage digital assets, as well as offer virtual assets payments and remittance services.
The MVP license also means that Binance can open a client money account with a domestic bank and provide increased levels of consumer protection by trading on a regulated platform under VARA’s supervision.
Maybe Other Countries Should Take Note
Binance and other exchanges have been under siege in the US for quite some time. The world’s largest exchange itself has been under scrutiny for alleged regulatory infractions. However, this did not stop the company from building. It has proven that it is willing to comply as long as there are clear and rational regulations.
The US is still trying to regulate the space by enforcement. This has driven a lot of talent and capital outside the country. Crypto exchanges and companies are going to Dubai and other jurisdictions because they have clear legal frameworks. Fortunately, lawmakers are now realizing that the country will lose if nothing is done. A bill sponsored by Senator Lummis is being crafted to correct this mistake.
Binance is the biggest crypto exchange and its success closely correlates to where the industry is going. Its success or failure will have a massive cascading effect on the whole space. Let us hope that its good fortune continues.
Source: Binance – here and here
Nice