Binance FZE, the Dubai-based arm of cryptocurrency exchange Binance, has successfully obtained a Virtual Asset Service Provider (VASP) license from Dubai's Virtual Assets Regulatory Authority (VARA). This milestone allows Binance FZE to operate as a regulated entity within the UAE, catering specifically to local residents.

In a recent blog post, Binance announced its intention to transition all UAE-based users from the Binance Global Exchange to the VARA-regulated Binance FZE exchange. As part of this move, users are required to update their Know Your Customer (KYC) information by submitting relevant documents before the December 15 deadline. Despite the transition, Binance assured users that all products currently available on the Binance Global Exchange will remain accessible on Binance FZE.

This development comes seven months after Binance withdrew its application for a license from the Abu Dhabi Global Market's Financial Service Regulatory Authority (FSRA), citing increased regulatory pressures. The decision to focus on Dubai underscores Binance's strategic pivot to align with regulatory frameworks in a region showing growing institutional interest in cryptocurrencies.

Dominic Longman, senior executive officer at Binance Abu Dhabi, highlighted the evolving regulatory landscape in the UAE, noting the absence of Bitcoin ETFs but indicating potential changes based on global trends and local market demands. Binance's initial steps in Dubai began in 2023 with the acquisition of an operational Minimum Viable Product (MVP) license from VARA, aimed at serving institutional and qualified retail investors.

Binance's successful acquisition of the VASP license positions it alongside other major crypto exchanges like Crypto.com, Bybit, and OKX, all of which have pursued regulatory approval from VARA to operate in Dubai's burgeoning crypto market.