Binance Faces Scrutiny As Dubai Demands Crucial Information

Binance News: According to recent reports, Dubai is increasing its scrutiny on firms seeking cryptocurrency licenses in wake of the now-bankrupt FTX collapse. The emirate is currently demanding additional information from exchanges such as Binance to bring in tighter compliance measures for safeguarding retail users and professional investors alike.

Dubai Questions Binance

In the past few weeks, Dubai’s newly constituted Virtual Assets Regulatory Authority (VARA) has requested additional information from Binance exchange regarding the company’s ownership structure, governance practices, and auditing protocols. According to a Bloomberg report, VARA is requesting comparable information from all of the multinational corporations that are applying for licenses in the city.

Read More: Here’s Why Elon Musk Changed Twitter’s Logo To That Of Dogecoin (DOGE)

Dozens of over-the-counter cryptocurrency exchanges that established there without licences have been targeted by the United Arab Emirates, of which Dubai is a part. The report further suggests that these measures are a part of a larger drive to get the United Arab Emirates off the “grey list” maintained by the Financial Action Task Force. This list is comprised of jurisdictions that fail to endulge enough in identifying and restricting illicit transactions.

Mounting Pressure On Binance

In reply to Bloomberg’s inquiry, Binance reponded to the recent news and was quoted as saying:

We have disclosed all necessary answers to VARA on a proactive basis and in line with our regulatory and fiduciary responsibilities.

Additionally, the company stated that it has disclosed information regarding the ownership structure of its local entity as well as its external auditor. According to people familiar with the situation, the time it takes to respond to those queries is significantly higher as a direct result of the scale and complexity of Binance. The crypto exchange operates with a worldwide advisory board rather than a traditional board of directors and does not have a central office anywhere in the world.

Late in March, as reported by CoinGape, the U.S. CFTC filed a lawsuit against Binance and its CEO, Changpeng Zhao. The lawsuit alleged that the defendants violated regulations governing derivatives and accused the company of having “sham” compliance procedures. Binance later stated that the lawsuit came as a surprise and would be looking forward to challenge it.

In light of this Binance news, the exchange’s native cryptocurrency BNB, witnessed a drop of roughly 1% in the past one hour. As things currently stand, the price of BNB is exchanging hands at $311 which boasts a market cap of $49 billion.

Also Read: MicroStrategy Bitcoin Holding Reaches 140K; Adds 1,045 More BTC

Pratik has been a crypto evangelist since 2016 & been through almost all that crypto has to offer. Be it the ICO boom, bear markets of 2018, Bitcoin halving to till now – he has seen it all.

The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.