The largest cryptocurrency exchange Binance is expanding its presence in Kazakhstan with the launch of a local exchange amid ongoing regulatory concerns in the United States.
The move follows Binance obtaining a license from the AIFC Financial Services Authority (AFSA) in October 2022, allowing the company to manage a digital asset platform and provide custodial services at the Astana International Financial Center (AIFC). In addition, the license qualifies Binance as a regulated platform in Kazakhstan.
Launching Binance’s new exchange
Binance’s launch announcement was made earlier at a press event, with the attendees being the Binance Kazakhstan leadership, government officials, and representatives of Kazakhstan’s banking industry. The new digital asset exchange will offer exchange and conversion services. It can also offer deposit and withdrawal of fiat currencies, exchange trading, and custody of crypto assets.
Kazakhstan’s Freedom Finance Bank will provide banking services to allow the exchange’s users to transfer their fiat funds from the bank to the new exchange’s platform. Currently, users can make fiat transfers through bank cards and transfers through the Freedom Finance Bank.
Ablaykhan Ospanov, Managing Director of Bank Freedom Finance Kazakhstan JSC, calls the move a significant boost for the industry and highlights that other countries should consider following in the country’s steps.
Vice Minister of Digital Development, Innovation, and Aerospace Industry in Kazakhstan, Asset Turysov, highlighted the government’s move to offer collaboration between crypto exchanges, the AIFC, and second-tier banks. Turysov noted that Binance had assisted the country in advancing a legislative framework and a general policy for crypto regulation.
Meanwhile, Zhaslan Madiyev, General Manager of Binance Kazakhstan, has commended the regulatory bodies for their play in the industry. In addition, he mentioned that he plans to expand the product line of the new exchange to have at least 100 digital assets approved by the end of 2023.
Regulatory trouble ensues in the West
Binance’s latest move comes amid regulatory trouble in the United States and several European countries. The exchange is facing a lawsuit from the Commodity Futures Trading Commission (CFTC) for allegedly soliciting users in the U.S. to make trade derivatives.
More recently, the exchange was slammed with another lawsuit by the U.S. Securities and Exchange Commission (SEC). The securities regulator accused the company of violating securities laws by offering specific cryptos as securities for trading, among other things.
The SEC had attempted to obtain a temporary restraining order to freeze the assets of BinanceUS, but both parties later managed to reach a compromise on the matter on June 18.
Apart from the United States, the crypto exchange is also in regulatory trouble in several European countries. The exchange has been under investigation in France since early last year for money laundering. It also has stopped providing services to Cyprus and the United Kingdom. The exchange also left the Dutch market when it could not receive a virtual asset provider license from Netherlands regulators.
The exchange defended its exit from many European countries as a move to become compliant with the European Union-approved Markets in Crypto Assets (MiCA) regulations. However, reports suggest European regulators collaborate with the SEC to investigate Binance.
Aside from Binance, other exchanges have been looking to get into the Asian market due to the regulatory uncertainty in the West. Gemini is shifting its focus to the Asia Pacific Region. They announced they were increasing staff at their Singapore division and setting up an engineering division in India. Meanwhile, Hong Kong has become a fast-developing crypto hub, and many crypto exchanges plan to shift their focus on the country. Furthermore, the country is inviting crypto platforms such as Coinbase to set up their regional office.
