Amid market chaos, Binance obtains license for Web3 and crypto custody in Abu Dhabi

Binance announced on Wednesday it has secured Financial Services Permission (FSP) to operate digital assets services in Abu Dhabi. The development comes irrespective of the current cryptocurrency market chaos, which has dented investors’ trust and diminished the credibility the government and regulators may have for the nascent industry. 

The permit by Abu Dhabi’s Financial Services Regulatory Authority (FSRA) will reportedly enable Binance to provide regulated crypto custody services for professional investors in the jurisdiction, as well as other Web3 services. Binance custody offering to the stated clients is, however, subject to compliance with the conditions of the FSP license, Zawya reported. 

We look forward to supporting Binance’s operations and R&D in ADGM to develop solutions for the Web3.0 economy.

Ahmed Jasim Al Zaabi, Chairman of ADGM.

Binance is gradually expanding its presence in UAE

Binance’s FSP licence reinforces its presence in Abu Dhabi, the United Arab Emirates (UAE), and more extensively, the Middle East. In April, the exchange obtained an In-Principle Approval from the Financial Services Permission of Abu Dhabi Global Market to operate as a broker-dealer in virtual assets under the regulator’s jurisdiction.

These permits bring Binance closer to the centre of Abu Dhabi’s digital assets market. Besides the capital city of UAE, Binance also obtained a limited license from Dubai’s regulators to operate a cryptocurrency exchange service. Among other exchanges, Binance seems to have set its foot deeper into the UAE crypto market, from regulatory permits to cryptocurrency services.

Even beyond crypto exchange and custody services, Binance had earlier partnered with Virtuzone to enable UAE-based entrepreneurs to accept payments in cryptocurrency.

Is the UAE the next big market?

Cryptocurrency exchanges appear to be contending in a not-so-visible race to dominate the emerging digital assets market in the Middle East, especially the United Arab Emirates (UAE). This is quite arguable given the increase in the number of exchanges which have obtained one or more permits from cities in the UAE in just the past months. Additionally, some companies have also planned to expand operational headquarters to the region.  

On another note, it’s not quite a surprise given the government’s friendly stance and previous plans to make the United Arab Emirates a cryptocurrency hub. In line with this goal, the UAE government introduced what appears to be “the world’s first comprehensive and robust virtual asset regulatory framework in 2018,” through the Abu Dhabi Global Market. 

In late September, the UAE also launched its Dubai and Abu Dhabi headquarters in the metaverse, becoming the first ever to build on the metaverse. Speaking on that, the UAE Minister of Economy, Abdulla bin Touq Al Marri, said “this is not a proof of concept, this is our third address.”