Major exchanges are intensifying their efforts to gain a foothold in the Arab Gulf States, and the regulators there seem to be more welcoming these days — specifically, Binance has secured a license to operate as a cryptoasset service provider in Bahrain, while its rival FTX recently received a digital asset exchange license in the United Arab Emirates.
Binance getting its license from the Central Bank of Bahrain (CBB) will allow the company to obtain its first permission to perform the role of a cryptoasset service in a member state of the Cooperation Council for the Arab States of the Gulf (GCC).
This latest license is a milestone in the firm’s strategy to expand its global position, according to Changpeng Zhao, Founder and CEO of Binance.
“Team Bahrain has shown considerable foresight in its development of crypto regulations and provides the regulatory protections that consumers should come to expect from regulators around the world,” he said.
Binance strived “to meet the stringent criteria of the Central Bank of Bahrain,” both locally and globally by ensuring that they “meet and exceed the requirements of regulators and protect users with strong anti-money laundering and counter-terrorism financing policies,” Zhao added.
Meanwhile, FTX secured a digital asset exchange license in Dubai where it aims to establish a regional headquarters.
For FTX’s European subsidiary which will hold the license, the expansion into Dubai will enable the firm to launch its virtual asset exchange and clearinghouse services in the Emirates.
Sam Bankman-Fried, CEO of FTX, said that the company planned to launch complex crypto-derivatives products in Dubai, relying on centralized counterparty clearing to institutional markets.
Earlier this month, the city adopted legislation to regulate its crypto industry through the establishment of a dedicated regulator, the Virtual Asset Regulatory Authority (VARA).
Sheikh Mohammed bin Rashid, Vice President and Ruler of Dubai, was quoted by The National as saying that:
“We established an independent authority to oversee the development of the best business environment in the world for the virtual assets in terms of regulation, licensing, governance and in line with local and global financial systems.”
Helal Saeed Almarri, Director General of Dubai World Trade Centre Authority, commented that the emirate’s new regulator was “structured to catalyze collaboration, foster innovation, and most critically prioritise public protection”.
This statement indicates that, while Dubai is ready to let major industry players into its financial system, it is focused on keeping the doors open only for the most reliable crypto-oriented businesses.
“Licensing FTX within this specialist regime reflects our focus on enabling only the most credible global players that demonstrate a consistent commitment to future-proof this sector,” Almarri said.
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