With trouble brewing up for it in the USA and other countries, Binance is looking for ways to extend its reach. It has just been granted a digital asset license in Dubai, and just weeks later, the largest cryptocurrency exchange received another in El Salvador. The South American island country was the world’s first to adopt Bitcoin as legal tender in 2021. It swapped fiat money with cryptocurrencies, and years later, it’s still going strong.
On August 8, the Central Bank of El Salvador officially signed the exchange’s application for a Bitcoin services provider license. The country’s national Digital Assets Commission further granted it a digital asset provider’s license. Thanks to this, Binance will be able to provide tailor-made products and services related to Bitcoin and crypto in El Salvador.
A Major New Market
This kind of news is significant because of El Salvador’s love for crypto. The country made Bitcoin legal tender along the US dollar in 2021 and hasn’t looked back since. Crypto-friendly and tech-savvy president Nayib Bukele has played a few smart moves since then, always buying crypto with the country’s reserves when it’s low and making profit when its price jumps. While many citizens didn’t like the idea, Bukele has pushed forward with it. He’s even developed plans for the mythical Bitcoin City which will run on pure volcano power powered by Bitcoin bonds.
Earlier in April, the country gave Bitfinex a digital asset provider license. It works independently as the country’s sole crypto exchange, but will now face stiff competition from Binance. That name is well known around the world, as it is considered a global crypto exchange with the largest reach. Due to regulatory problems in the USA—where the SEC may take legal action—Binance has announced an extension in Japan and received a digital asset license in Dubai too.
With the new extension in El Salvador, the world’s largest cryptocurrency exchange will retain its crown. It remains to be seen what happens in the USA, where both the exchange and its CEO are under scrutiny by the SEC.
Legal Case In the USA
The exchange is under massive pressure by the US Securities and Exchange Commission for allegedly offering prohibited services and operating illegally. The SEC has yet to tell us what real securities are, but until then, it has the ground set up for legal action against Binance and other exchanges. In addition to the legal action from the SEC, the Commodity Futures Trading Commission targets the exchange’s CEO Changpeng Zhao for violating trading and derivatives regulations.
It remains to be seen if the case can truly be pushed forward, as Binance and Coinbase too won’t sit idly. The big problem is that while the exchanges have delisted the problematic pairs and coins, the SEC is still continuing its legal action. It simply doesn’t make sense for it to continue with the witch hunt. However, Binance has once again played it smartly, boosting its operations overseas so it continues to hold its position on the market.