Crypto Company Binance Facing Regulatory Pressure in Dubai and US
- Virtual Assets Regulatory Authority (VARA) in Dubai has requested Binance to reveal information about their business.
- The city is planning to establish strict rules for crypto innovation.
- The exchange is also facing pressure in the US, as the Commodity Futures Trading Commission (CFTC) has filed a lawsuit against them.
The crypto exchange Binance, which was granted the approval of the Virtual Assets Regulatory Authority (VARA) in Dubai back in September 2022, is now facing regulatory pressure in both the US and Dubai. The VARA has requested the exchange to provide more details regarding their business operations, ownership structure, auditing procedures, and governance.
In an effort to tackle the crypto challenges with stringent regulations, Dubai is making sure that all crypto companies applying for licenses must comply with the highest standards. Bloomberg shared a tweet saying, “Dubai, the adopted home of Binance founder Changpeng “CZ” Zhao, is boosting scrutiny of crypto license applicants”:
Dubai, the adopted home of Binance founder Changpeng “CZ” Zhao, is boosting scrutiny of crypto license applicants https://t.co/dcgRM5hLsg
— Bloomberg Crypto (@crypto) April 9, 2023
Binance officials have responded that they have “disclosed all necessary answers to VARA on a proactive basis and in accordance with our [their] regulatory and fiduciary responsibilities”.
These regulations have been posing stress on Binance as they are also being held accountable by the US. On March 28, the CFTC filed a lawsuit against the crypto firm accusing them of operating without proper registration.
The sources of information reported that the VARA is currently scrutinizing all international crypto exchanges that are seeking licenses in order to reduce crypto losses after the financial crisis.
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