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Amid regulatory turmoil elsewhere, Binance’s Dubai affiliate, Binance FZE, managed to score an Operational Minimum Viable Product license from the Virtual Assets Regulatory Authority (VARA).
Binance has now become the first crypto trading platform to receive Dubai’s Operational MVP license enabling it to offer services such as exchange and broker-dealer services. The company is permitted to serve only institutional and qualified retail investors for now.
Binance’s Dubai Expansion
Eligible users in Dubai will be allowed to access authorized services such as converting digital assets to fiat under VARA-designated standards compliant with Intergovernmental Financial Action Task Force (FATF).
In an official statement, Binance’s Head of Regional Markets, Richard Teng, said the priority is to operate this first fully regulated exchange in and from the city in an ecosystem that’s compliant with the FATF while focussing on global scalability.
“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.”
The latest development comes after Binance obtained a provisional MVP license in March 2022, followed by a preparatory MVP license five months later.
Binance has so far completed three out of four stages of Dubai’s licensing procedure.
The fourth phase involves obtaining Full Market Product (FMP) license, until which the virtual asset service provider is not permitted to cater services to mass retail investors.
Crypto Hotbed: Dubai
In recent years, Dubai has emerged as a hotbed for crypto activity owing to the emirate’s strategic policies. The establishment of VARA was a major turning point for the region, which has, so far, proved instrumental in providing clarity to several crypto firms distressed by the US’s approach to regulating the industry.
Despite prohibiting involvement with privacy-centric coins under the new regulatory regime, the city has opened arms to several crypto exchanges, including OKX, Bybit, and more.
A recent study published by Recap revealed that Dubai hosts nearly 800 crypto-based companies as of January 2023 for residents to choose from when it comes to finding a career in the sector. Its 0% tax regime also makes it a favorable venue for crypto investors.