Bloomberg reports that the Dubai Virtual Assets Regulatory Authority (VARA) has taken steps to tighten the requirements for crypto companies seeking to operate in the emirate.
VARA has requested additional information from Binance, a crypto exchange that already holds a license to operate in Dubai, regarding the company’s owners, governance structure, and audit procedures.
Other companies seeking a license have also received similar requests.
Speculation suggests that these moves may have been prompted by pressure from Western regulators, particularly from the United States, which recently accused Binance of violating federal laws regulating commodity markets by not having US registration.
Binance CEO Changpeng Zhao has relocated to Dubai and aims to expand business in the Middle East.
Experts believe that VARA’s efforts to tighten regulations reflect a desire to establish Dubai as a hub for the cryptocurrency economy while maintaining ties with countries that adopt a more stringent policy towards digital assets.
Binance representatives confirmed that they have provided the requested information in accordance with regulatory and fiduciary obligations, and the company recently received approval to provide custodial services for professional market participants in the United Arab Emirates.