Georgia aims to be one of the most crypto-friendly countries in the world. Last year, its Minister of Economy and Sustainable Development said that a package of draft crypto laws had already been handed to parliament. The country has plans to become a global crypto hub by 2025. And in June 2023, the National Bank of Georgia issued new regulations for Virtual Asset Service Providers (VASPs) operating in the country.
In 2022, Binance was considering the possibility of opening a regional office in Georgia but was waiting for the introduction of a licensing regime. However, before the regulation was issued this spring, the world's leading exchange bit the bullet and opened the office, “looking to ramp up talent acquisition, promote blockchain education, and accelerate crypto adoption in the region.”
Unfortunately, not everything went as planned. According to our local Observer, Binance will no longer have an official presence in Georgia from September 1, as the exchange didn’t manage to receive a license. The official announcement is expected within a few days. Allegedly, the exchange didn’t meet some of the requirements for VASPs stated in the above-mentioned document.
Binance had been looking for alternative locations after it was forced to exit multiple European countries. Along with the Georgia move, the exchange's management was actively exploring Kazakhstan, although at the time of writing, there have been no further updates about developments there.
It has not been an easy year for Binance as the exchange is facing multiple legal and compliance issues around the world. Just this week, we Observed that Binance was being investigated by the U.S. Department of Justice for potential violation of the sanctions regime against Russia. Since then, the Wall Street Journal has reported about limitations enforced on Russian-sanctioned banks in response to the allegations.
These legal and compliance issues are not only hurting Binance's sales but also resulting in the loss of key personnel and partners, as people try to distance themselves from the toxic reputation of the exchange. Most recently, Mastercard and Visa have pared back their co-branded card projects with Binance.
What do you see in Binance's future? Will it shake off its current troubles and rise again like a phoenix? Or will it eventually succumb to the legal onslaught?