Bloomberg reports that Dubai’s crypto regulator is also requesting similar information from other global crypto players.
Bloomberg reported that the Virtual Assets Regulatory Authority (VARA), which governs crypto activity in Dubai, demanded additional information about Binance’s business requirements as part of its efforts to tighten Regulatory constraints in the emirate.
Bloomberg reported on April 5, citing three anonymous sources, that the regulator has requested additional information regarding Binance’s ownership structure, governance, and auditing processes. According to sources close to the situation, VARA has requested the same information from global crypto players seeking a Dubai license.
In addition to board processes, VARA authorities have also demanded that Binance submit similar information at the global group level, according to two sources. Due to the scale and complexity of the exchange, it takes longer to respond to inquiries.
The increased monitoring of virtual assets service providers (VASPs) in Dubai adds to Binance’s challenges, which are heightened by increased pressure from U.S. regulators.
The Commodity Futures Trading Commission of the United States filed a lawsuit against Binance and its CEO Changpeng Zhao last week, saying that the exchange participated in unlawful compliance procedures and trading.
Since then, Zhao has denied the allegations, calling them “an incomplete recitation of facts” and asserting that Binance “does not trade for profit or manipulate the market.”
My Response to the CFTC Complaint | Binance Blog https://t.co/TadyotM7HN
— CZ 🔶 Binance (@cz_binance) March 27, 2023
VARA issued Binance a minimal viable product (MVP) license in September of last year. The license authorizes the platform to establish a presence in the United Arab Emirates and offers digital asset exchange services to pre-qualified investors. However, the company is yet to offer digital asset services in the emirate that comply with local regulations.
Before obtaining a complete market product permit, the largest crypto exchange by trading volume must submit the appropriate documents to VARA to upgrade to an operational MVP license, allowing it to offer its services to eligible individual and institutional investors.
Currently, only Hex Trust has obtained an operational MVP license from the Dubai regulatory body. According to the VARA website, VASPs already delivering their services must comply with their standards by June 30.