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Middle East regulatory clarity drives crypto industry growth — Binance FZE head

October 18, 2023 Coin Telegraph

UAE, Dubai and Bahrain continue to attract major cryptocurrency exchanges and businesses due to their progressive regulatory approaches.

Major cryptocurrency exchanges and businesses are being lured to a proverbial crypto oasis around the Persian Gulf, according to Binance FZE’s general manager.

Alex Chehade, who heads Binance's local operation in Dubai, tells Cointelegraph reporter Ezra Reguerra that progressive regulatory frameworks in the region are a major drawcard for startups and established industry players:

“What stands out in the Middle East is regulatory certainty and clarity. We have a virtual-asset-specific regulator here in Dubai, VARA. We have ADGM with its virtual asset framework, we have Bahrain’s central bank being accepting of cryptocurrencies.”

Chehade believes that regulators in other jurisdictions have not quite figured out or taken the time to learn the ins and outs of the cryptocurrency landscape, or simply lack the “bandwidth” to begin regulatory the sector:

“So you’re seeing events like GITEX and Future Blockchain Summit as well as global companies coming here because it’s easy to do business.”

The Binance FZE general manager adds that businesses need certainty in order to create long-term plans and the regulatory parameters that exist in these specific jurisdictions are facilitating that process.

Cointelegraph's Ezra Reguerra in conversation with Chehade at Future Blockchain Summit in Dubai.

Chehade also highlighted Binance’s role as a catalyst of sorts for Web3 companies and startups to become established in the region.

“We’re an ecosystem enabler, we’re the biggest Web3 company in the world. You often see network effects with size and we’re seeing a healthy environment with big and small players.”

Chehade stated that Binance now employs around 600 people in its Dubai-based operation and will continue to play its part in fostering the industry. He adds that Binance FZE has been operating as a regulated exchange in Dubai for a year and a half and is segregated from the rest of its global operations with ring-fenced custody and operations.

In a prior interview with Cointelegraph at the Blockchain Economy Dubai Summit, Akshay Chopra, Visa’s vice president, and head of innovation and design, echoed Chehade’s sentiments regarding the region's progressive regulatory outlook.

As a board member of the MENA Fintech Association, Chopra highlighted the “forward-looking and inclusive view of blockchain and crypto solutions” as a key driver of growth for the sector in the region:

“Regulators are actually looking forward and working with the local blockchain community, institutions, startups, entrepreneurs to come up with a very inclusive perspective on what is the future and how can we be best positioned both as a market and as a regulator.”

Research from blockchain analysis firm Chainalysis indicates that the MENA region is the fastest growing cryptocurrency market in the world. Transaction volume in the region reveals users received $566 billion in crypto between July 2021 and June 2022.

Additional reporting by Ezra Reguerra.

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Binance’s Richard Teng denies FTX comparisons: ‘We welcome the scrutiny’

September 11, 2023 Coin Telegraph

Binance

Binance regional markets head Richard Teng insists that, despite regulatory scrutiny, the company has no parallels to collapsed exchange FTX.

Binance regional markets head Richard Teng insists that the global cryptocurrency exchange is financially secure and in no way similar to bankrupt peer FTX despite recent regulatory scrutiny and regional challenges.

Speaking exclusively to Magazine editor Andrew Fenton in Singapore ahead of the 2023 Token2049 conference, Teng addressed a variety of different challenges being faced by Binance’s regional arms as well as playing down reports that he is being groomed to take the reigns from founder Changpeng “CZ” Zhao in the future.

*Binance head of regional markets Richard Teng speaking at Ethereum Singapore 2023.*

Teng said that, while Binance has faced different issues over the past couple of years, it has managed to tackle these on a case-by-case basis while remaining financially strong and able to process customer withdrawals.

Saw some debates in the community. When you do the right thing, and there is FUD, you don't have to do anything. The community defends you.

Let me summarize. There have been a lot of negative news/rumors, bank runs, lawsuits, closing of fiat channels, product wind downs,…
— CZ Binance (@cz_binance) September 7, 2023

Commenting on a recent social media post from CZ that highlighted “negative news/rumors, bank runs, lawsuits, closing of fiat channels, product wind downs, employee turnover,” Teng said that comparisons to the failure of FTX were unjustified:

“There were different rumors and FUD after FTX. People tried to associate us, which is totally untrue. Our assets are backed one-to-one.”

He also addressed recent Cointelegraph exclusives that revealed high-level executives had departed Binance as well as another report on the company’s ties with Russian banks. Teng said that the exchange’s stellar growth in the space of six years continues to leave it in the spotlight.

“All this scrutiny will come from being the largest — scrutiny from regulators, scrutiny from the media — and we welcome the scrutiny.”

Teng said that Binance has not yet made a decision regarding its franchise that serves the Russian market while maintaining that the company continues to adhere to international norms and standards in regards to sanctioned entities and individuals:

“On our plans for Russia, we have stated very clearly in the last couple of weeks that all options are on the table. We continue to explore what we need to do for that particular franchise going forward.”

Meanwhile, maturing regulatory frameworks in various jurisdictions are also being welcomed by the global exchange. Teng said that the European Union’s Markets in Crypto-Assets (MiCA) regulation could benefit exchanges universally by creating standardized rules for the industry:

“This disparate treatment, it makes life very difficult for global platforms like for ourselves. In terms of local deployment, we need to understand how the rules and regulations are very different. So, what we hope for is harmonized standards.”

Teng said that MiCA was a “step in the right direction” in providing the 23 EU member states with a consistent set of standards, which in turn could lead to a wider convergence of global regulatory guidelines for the industry.

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Regulation still key for the evolution of CeFi: Paris Blockchain Week

March 23, 2023 Coin Telegraph

CeFi

Regulatory considerations are front and center as a panel of cryptocurrency industry insiders unpacks the current state of CeFi and DeFi in Paris.

Centralized finance (CeFi) will continue to be an important avenue to drive the adoption of decentralized finance (DeFi) services in the future, but regulatory considerations remain a significant part of the process.

This was a key theme that emerged during a panel titled ‘How to Do CeFi Right - the Balance Between TradFi & DeFi?’ at Paris Blockchain Week. A handful of industry experts weighed in on the current state of CeFi and DeFi, their relationship and importance for the future of the space.

Eric Turner, vice president of market intelligence at Messari, highlighted the core difference between the two terms, which have become somewhat overlapping in recent years given the link between centralized exchanges and decentralized platforms:

“When you think about what we consider CeFi today, it’s the centralized exchanges. It’s people that are offering custody services and lending services. But if it's between DeFi and CeFi, you know, all of those services can be built in different ways.”

Turner also highlighted CeFi’s role as the main onramp for the ‘next billion users’ in terms of a fiat entry mechanism as well as a trusted avenue for larger professional investors to move into the crypto space.

*Panelists unpack the convergence of CeFi and DeFi and the role regulation has to play in driving future adoption at Paris Blockchain Week.*

Joaquin Sastre, BitGo’s LatAm & EMEA managing director, said that the institutional-focused wallet platform sees a key difference between the two categories:

“What really matters here, to differentiate between CeFi and DeFi from our view, is really the access and the storage.”

Sastre maintains that adoption of DeFi protocols and platforms will be a natural progression, while CeFi continues to give regulators a means to offer some protection institutions through controls and legal parameters.

Ian McAfee, co-founder and CEO of Shift Markets, highlighted the importance of what CeFi platforms and DeFi protocols have to offer while suggesting the terminology itself serves more to describe and capture what the technology could do:

“Finance will just be using blockchain 20 years from now, right? So these words are just kind of going to evaporate.”

Charlie Meraud, CEO of cryptocurrency market maker Woorton, believes that the two are becoming intrinsically linked, moving on from the original drawcards of DeFi which offered interest rates on liquidity pools that were better than anywhere else:

“We’re going to end up in a world where you take a credit risk with TradFi, or a technology risk with DeFi. You're going to have to trade off between those two and make those two live in the same world.”

CeFi also remains a key driver for cryptocurrency adoption according to McAfee, who said that centralized institutions are still ‘waking up to crypto’ as an asset class. Helping banks and brokers largely involves introducing them to CeFi services like centralized exchanges:

“You give it to them in a format that they're familiar with. The first thing people do is to buy Bitcoin or the first thing that gives a taste of this new technology.”

Sastre also believes that tokenization of assets is another major driver of adoption which is served by both CeFi and DeFi players. He said that tokenization of financial assets and real estate are ‘no-brainers’ that will be driven by wider use of CeFi in particular:

“It gives you access to the asset to be able to be traded worldwide 24/7. That is a huge advantage for financial markets and also for normal people in the street.”

While CeFi continues to plug into DeFi protocols to serve both retail and institutional users, regulation remains one of the most important considerations for organizations and businesses looking to enter the cryptocurrency ecosystem through some sort of exposure.

For BitGo’s Sastre, regulation is an inevitable component that is necessary given the fallout of the collapse of core CeFi players like FTX over the past year:

“These things can be avoided if there's a segregation of duties, if there's qualified, regulated fiduciary custodians holding the assets and giving the proven truth of reserves.”

Turner also stressed the importance of the cryptocurrency industry taking a more active role in driving conversations with regulators and government agencies to help the not-so crypto savvy have a better understanding of the ins and outs of the ecosystem:

“If we can regulate where the on ramps and the off ramps are, I think that's incredibly powerful to allow us to build everything else in this industry.”

The regulation was a particularly hot topic given that American cryptocurrency exchange Coinbase received a Wells Notice from the U.S. SEC in relation to its staking services on March 22. This is a prime example of a CeFi player offering DeFi-based services to its users.

Cointelegraph is on the ground at Paris Blockchain Week - providing live updates from key presentations, panels and interviews throughout the event.

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Germany and the US share the top spot in the global crypto rankings: report

July 15, 2022 Coin Telegraph

Adoption

The U.S. climb the rankings to join Germany at the summit as progressive regulations and institutional adoption drive cryptocurrency use in both countries.

Germany and the United States shared the spoils in the latest quarterly global cryptocurrency rankings released by analytics firm Coincub.

The two countries now share the top rankings, with Germany making space for the rising U.S., having topped the first quarter rankings for 2022. Their dominance is due to progressive regulatory environments and major Bitcoin (BTC) investments by mainstream institutions.

Coincub’s rankings tally up points across nine overall categories, which focus on government, financial services, population, taxation, talent development and industry participants, trading, fraud and environmental potential. The current ranking system introduced new sub-categories like crypto education courses and initial coin offerings to create a more comprehensive gauge.

Germany’s move to allow its savings industry to utilize crypto investments and benefit from a zero-tax policy on capital gains of Bitcoin and Ether (ETH) held for more than a year was a key reason for its rise to the top of the rankings earlier this year.

The U.S. moved up from third to share the top rank, driven by president Joe Biden’s executive order on Ensuring Responsible Development of Digital Assets in March 2022. The directive aims to guarantee the responsible development of the space, provide consumer protection and financial stability, and combat illicit activity.

Coincub also cited global investment firm Fidelity’s decision to include Bitcoin exposure as part of select American pension funds in April 2022 as a pivotal role in the country's climb up the crypto rankings. Parallels were drawn with a move by Germany’s financial services firm Sparkasse to enable its 50 million users to buy Bitcoin directly from their bank accounts.

Switzerland sits third on the global crypto rankings, driven by the most recent development in the country which saw the canton of Lugano recognize Bitcoin as legal tender. This allowed citizens in the area to make everyday payments using BTC, including taxes and municipal accounts and services.

More than 1000 blockchain and virtual asset service providers (VASPs) call Switzerland home, and the country ranks highly for its number of Bitcoin nodes and ATMs. VASPs have to be licensed by the Swiss Financial Market Supervisory Authority (FINMA) and abide by anti-money laundering (AML) and Know Your Customer (KYC) policies.

Singapore is ranked fourth after Q2 in 2022, having fallen from its top spot at the end of 2021 due to recent regulatory tightening from the country’s financial regulator and the central bank.

Australia rounds off the top five of Coincub’s crypto rankings, with the firm highlighting a high number of initial coin offerings, exchanges and transaction volumes as well as a number of universities offering blockchain and crypto educational courses.

Coincub’s rankings combine quantitative data including trading or mining volumes with qualitative elements like government legislation and institutional attitude towards cryptocurrencies. Their reports look to provide a consolidated view of a country’s stance by amalgamating qualitative information and quantitative data.

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Regulatory

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