Middle East regulatory clarity drives crypto industry growth — Binance FZE head
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 [Virtual Assets Regulatory Authority]. We have ADGM [Abu Dhabi Global Market] with its virtual asset framework, [and] 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 regulating 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 facilitate that process.
Chehade also highlighted Binance’s role as a catalyst for Web3 companies and startups to establish 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.
Related: Dubai lures AI, Web3 enterprises with 90% subsidized commercial licenses
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 Middle East and North Africa (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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Making Britain better off will be “at the forefront of the chancellor’s mind” during her visit to China, the Treasury has said amid controversy over the trip.
Rachel Reeves flew out on Friday after ignoring calls from opposition parties to cancel the long-planned venture because of market turmoil at home.
The past week has seen a drop in the pound and an increase in government borrowing costs, which has fuelled speculation of more spending cuts or tax rises.
The Tories have accused the chancellor of having “fled to China” rather than explain how she will fix the UK’s flatlining economy, while the Liberal Democrats say she should stay in Britain and announce a “plan B” to address market volatility.
However, Ms Reeves has rejected calls to cancel the visit, writing in The Times on Friday night that choosing not to engage with China is “no choice at all”.
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The chancellor will be accompanied by Bank of England governor Andrew Bailey and other senior executives.
She will meet with her counterpart, Vice Premier He Lifeng, in Beijing on Saturday to discuss financial services, trade and investment.
She will also “raise difficult issues”, including Chinese firms supporting Russia’s invasion of Ukraine and concerns over constraints on rights and freedoms in Hong Kong, the Treasury said.
But it did not mention whether Ms Reeves would raise the treatment of the Uyghur community, which Downing Street said Foreign Secretary David Lammy would do during his visit last year.
Britain’s Foreign Secretary David Lammy and Chinese Foreign Minister Wang Yi in Beijing. Pic: AP
On Friday, Culture Secretary Lisa Nandy defended the trip, telling Sky News that the climbing cost of government borrowing was a “global trend” that had affected many countries, “most notably the United States”.
“We are still on track to be the fastest growing economy, according to the OECD [Organisation for Economic Co-operation and Development] in Europe,” she told Anna Jones on Sky News Breakfast.
“China is the second-largest economy, and what China does has the biggest impact on people from Stockton to Sunderland, right across the UK, and it’s absolutely essential that we have a relationship with them.”
Read more – Ed Conway analysis: The chancellor’s gamble with China
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Nandy defends Reeves’ trip to China
However, former prime minister Boris Johnson said Ms Reeves had “been rumbled” and said she should “make her way to HR and collect her P45 – or stay in China”.
While in the country’s capital, Ms Reeves will also visit British bike brand Brompton’s flagship store, which relies heavily on exports to China, before heading to Shanghai for talks with representatives across British and Chinese businesses.
It is the first UK-China Economic and Financial Dialogue (EFD) since 2019, building on the Labour government’s plan for a “pragmatic” policy with the world’s second-largest economy.
Sir Keir Starmer was the first British prime minister to meet with China’s President Xi Jinping in six years at the G20 summit in Brazil last autumn.
Relations between the UK and China have become strained over the last decade as the Conservative government spoke out against human rights abuses and concerns grew over national security risks.
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How much do we trade with China?
Navigating this has proved tricky given China is the UK’s fourth largest single trading partner, with a trade relationship worth almost £113bn and exports to China supporting over 455,000 jobs in the UK in 2020, according to the government.
During the Tories’ 14 years in office, the approach varied dramatically from the “golden era” under David Cameron to hawkish aggression under Liz Truss, while Rishi Sunak vowed to be “robust” but resisted pressure from his own party to brand China a threat.
The Treasury said a stable relationship with China would support economic growth and that “making working people across Britain secure and better off is at the forefront of the chancellor’s mind”.
Ahead of her visit, Ms Reeves said: “By finding common ground on trade and investment, while being candid about our differences and upholding national security as the first duty of this government, we can build a long-term economic relationship with China that works in the national interest.”
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