Binance becomes first crypto exchange to obtain category 4 license by Bahrain

Saif Naqvi
Source: Pixabay

The Middle East region is turning out to be a key player in crypto investments and Binance has sought to capitalize on this trend. On that front, Binance became the first exchange to be granted a category 4 license by Bahrain, allowing it to offer a full range of crypto exchange services in the country.

Source: Twitter

On Thursday, Binance Bahrain, the regional arm of the world’s largest exchange by volume, became the first crypto exchange to receive a category 4 license as a crypto-asset service provider from the Central Bank of Bahrain. The license allows Binance to provide a full range of crypto-asset exchange services to customers under the supervision of the Bahrain regulators.

The news comes during a time when the exchange has looked to strengthen its presence in the Middle East after receiving Virtual Asset License licenses to operate in Dubai and Bahrain earlier in the year. Speaking on the category 4 license, Richard Teng of Binance, said:

“The upgrade to a Category 4 license in the Kingdom of Bahrain is a landmark achievement for Binance and further signifies our commitment to being a compliance-first exchange. This will allow us to provide the full suite of products and services that users have come to expect from an exchange, in a safe and well-regulated environment”

Middle East crypto market to bloom further

While banks and financial regulators in the Middle East have been slower to embrace crypto than other regions such as Europe and the U.S., the trend is beginning to change. According to Chainalysis, the Middle East is one of the fastest-growing crypto markets in the world, accounting for 7% of global trading volumes in 2021.

Furthermore, crypto is also being embraced by regulators as demand grows amongst investors. Rain exchange, the region’s first Sharia-compliant cryptocurrency platform, raised $110 million in a Series B round in January. The raise was one of the largest investment deals for any startup in the Middle East and North Africa at the time and set the standards for what was to follow.

Meanwhile, The UAE government had created a special crypto zone at the Dubai World Trade Centre last year, where cryptocurrencies and other virtual assets are regulated. In December, Binance had signed a deal to develop a new industry hub dedicated to digital innovation and cryptocurrency in the region.

Now that Binance has set the tone in Bahrain, the likes of FTX and Kraken, both of which have a presence in the Middle East, may also look to ramp up their local presence in what could soon become the next crypto hotspot in the world.