Binance, the world’s largest cryptocurrency exchange, has received in-principle approval from the Abu Dhabi Global Market to operate as a broker-dealer in virtual assets in the UAE capital.
After completing its application process for full licensing, Binance will be able to offer its virtual asset services to customers across the Middle East and North Africa region through its subsidiary Binance (AD) Limited, the company said on Sunday.
"ADGM is the largest regulated jurisdiction of virtual assets in the Mena region and Binance’s participation will add to its vibrant and trusted ecosystem of virtual asset trading venues, global exchanges and service providers," said Dhaher bin Dhaher, chief executive of the Registration Authority at Abu Dhabi Global Market.
Binance is seeking to expand its presence in the Middle East, following approvals in Bahrain and Dubai, as it seeks to cash in on the region's interest in cryptocurrencies.
Last month, the exchange secured a virtual asset licence to operate in Dubai after the emirate outlined clear regulations to govern emerging technology sectors such as cryptocurrencies in an effort to safeguard investors.
Binance was founded in China in 2017 and has its headquarters in the Cayman Islands and Seychelles. The exchange has faced increased regulatory scrutiny in the US, UK, Europe and China and has taken steps to improve its relationship with regulators.
"Binance has been actively engaging global regulators, such as ADGM, as part of its ongoing commitment to uphold global standards and collectively foster the developments and sustainable growth of the crypto ecosystem," said Richard Teng, head of Mena for Binance, who was previously chief executive of ADGM.
"We look forward to working closely with ADGM and other key Abu Dhabi stakeholders for broader deployment of our world-class offerings and services across the whole Mena region and beyond.”
Cryptocurrency adoption today accounts for only 4 per cent to 5 per cent of the global population, while less than 1 per cent of global wealth is invested into this asset class, figures compiled by Binance show.
The UAE is quickly emerging as a preferred destination for crypto exchanges. Last month, global cryptocurrency exchange FTX said it received a virtual asset licence to set up regulated trading and clearing services in Dubai. Cryptocurrency exchange Bybit, which has more than two million registered users, also received an in-principle approval to conduct virtual assets business in Dubai.
The digital economy contributes about 4.3 per cent to the UAE’s gross domestic product, which is equivalent to Dh100 billion ($27.2bn), government figures show.