Amid increased regulatory scrutiny, cryptocurrency exchange Binance is placing Ireland among the list of jurisdictions to set up a headquarter.
The firm’s CEO, Changpeng Zhao, has confirmed that the exchange is already in the process of setting up several headquarters globally, with Ireland among the possible destinations, Reuters reports.
Despite confirming Ireland as a possible host for a Binance headquarter, Zhao declined to give further details.
Regulators across the world have in recent months scrutinised Binance, the world’s largest exchange by trading volumes. Some have banned the platform from certain activities, while others have warned consumers that it was unlicensed to operate.
In response, CEO Changpeng Zhao said in July he wanted to improve relations with regulators, and would break with its “decentralised” structure and establish regional headquarters.
Last month, Binance registered three firms in Ireland, corporate registry documents show.
“Historically, we claim that we don’t have headquarters. We are actually just in the process of establishing a few headquarters in different parts of the world,” Changpeng Zhao said in an interview.
Asked if Ireland featured in Binance’s plans to establish headquarters in a particular country, Zhao replied: “Yes it does.” He declined to give further details of the plans for the country.
“When we first started we wanted to embrace the decentralised principles, no headquarters, work all around the world, no borders,” he said. “It’s very clear now to run a centralised exchange, you need a centralised, legal entity structure behind it.”
Trading volumes at Binance soared between July and September, suggesting a recent crackdown by regulators across the globe has had little impact on the platform’s business.
Binance’s corporate structure is opaque. Its holdings company is registered in the Cayman Islands, according to British court documents and Malaysia’s securities watchdog.
Additionally, Zhao lives in Singapore and this is going to be a good option for regional headquarters. Currently, The country’s regulator, the Monetary Authority of Singapore (MAS) is threatening Binance.com for possible violation of the Payment Services Act (“PS Act”). Of course, already have placed the exchange on its Investor Alert List. Meanwhile, this is because of carrying out the business of providing payment services without proper license. Additionally, it announces halting Singapore users from buying cryptocurrencies using fiat, spot trading. Also, liquid swaps on its main Binance.com platform from Oct. 26.
While Binance (Ireland) Holdings has been registered in the country for about a year now, the firm has registered three more firms in recent days. Binance APAC Holdings, Binance Services Holdings and Binance Technologies were all registered last month on separate dates.
Irish law firm Mason Hayes & Curran was employed, with records showing Binance's office as an accountancy shop in an undescribed building located in the south of Dublin. The filings also show that an official signing by CEO Changpeng Zhao was done between 10 September and 13 September. The documentation additionally places Zhao's residential address in Malta and confirms his Canadian citizenship.
Binance has faced regulatory skirmishes around the world, and just recently, even crypto-friendly Singapore asked the exchange through the Monetary Authority of Singapore to stop offering crypto trading services through its global platform Binance.com. The exchange confirmed the directives even though they did not affect Binance Singapore, an affiliate service of Binance Asia.
Confirming the report, a Binance spokesperson said, "We are working closely with the Monetary Authority of Singapore and other global regulators to comply with the relevant regulatory standards and facilitate any required service changes."
Ireland's central bank has cautioned citizens about investing in speculative digital assets like crypto. Back in May, the bank told users that cryptocurrencies like Bitcoin were of great concern because of their volatile nature, which exposed users to losses. The bank's governor Gabriel Makhlouf also warned against the risks involved in crypto, including the lack of transparency, crypto use in crime and the high energy consumption associated with crypto mining.
Before China’s declared crypto trading as illegal, Binance has faced a considerable level of hostilities from regulators around the world.
Just last month, the exchange was forced to suspend some of its operations in Singapore after the leading financial regulator of the Asian country ordered it to stop providing payment services to residents of the country.
Apart from Singapore, the troubles from other financial regulators spread across different countries forced CZ to declare that the exchange was going to have a physical headquarters soon because the authorities do not know how to deal with them due to their lack of a verifiable hq.
However, the exchange is making a headway in its effort to become more regulatory compliant as it has restricted some of its product offerings in a number of countries due to regulatory pressures.
However, it currently operates in Singapore as a separate entity. Binance Asia Services (BAS) exempts from holding a license as part of transitional arrangements under the city-state’s PS Act for the provision of digital payment token services.
Conclusively, This exemption allows entities to offer services while their license applications is underway. BAS’ license application is currently under review, according to information from MAS.
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