Switching Binance to a conventional corporate structure was part of an agreement between the exchange and U.S. authorities last November that allowed Binance to remain operational. Establishing the board of directors and naming formal headquarters were among the most significant tasks the company’s new director, Richard Teng, faced after replacing CZ.
The new board of directors was established at the beginning of April. It was a step towards better governance, but the board’s composition, which primarily consists of company insiders, hinted that the exchange remains resistant to outside control and oversight. As for the possible location of Binance’s formal headquarters, Teng declined to comment on the matter until last week.
At the Paris Blockchain Week conference, Teng said that the company “is speaking to a few jurisdictions, a few are under consideration,” adding that the company reached “regulatory maturity.”
“It’s not an easy decision, there are a lot of considerations as you can imagine [including] whether the jurisdiction has the regulatory framework to cater to the breadth and depth of our products, that can cater to our users … [and] whether we can base more people there as part of our corporate headquarters,” - said Teng.
The exchange has been establishing local entities around the world to comply with regulations over the last few years and has sought registration in multiple countries. Still, at the moment, it is not completely clear which location will become the homeland of the world’s leading exchange.
We have studied the map, and here are our observations.
Europe
The European Union might soon become the region providing proper regulations for the crypto industry. The Markets in Crypto-Assets (MiCA) regulatory framework enters into force on December 30 this year. Clear regulations are an important benefit for Binance if it wants to operate in compliance with laws. Besides, Europe is a vast market, and having a local base would allegedly provide Binance with better access to it.
France is a possible home: the country welcomes blockchain companies, and Binance is already licensed there. The drawback is that local authorities have reportedly been investigating the exchange for money laundering since 2023. It's also worth mentioning that Binance exited some European countries, including the U.K. and Netherlands, last year due to compliance issues and dropped the pursuit of a license in Germany.
Asia
Binance has consistently denied its links to its true homeland, China, suggesting it would prefer to distance itself from Asia. If the company decides to stay close to home, crypto hubs like Singapore and Hong Kong are among the most likely destinations. Currently, Binance is not providing services to retail clients in Singapore as it has failed to meet its strict requirements. Still, perhaps ‘Teng’s Binance’ is compliant enough, and establishing its base in Singapore could become an important benchmark for the company.
Binance isn't licensed in Hong Kong either; the hub currently officially allows only two local exchanges. Furthermore, any exchanges that have not submitted license applications to the local watchdog — and Binance has not — must close down their businesses in Hong Kong by the end of this May.
Japan is an option as well: cryptocurrencies are legal there, and Binance already has a local entity that allows the exchange to operate in compliance with the law. The drawback here is the extremely high taxes for residents which discourage Web3 companies from setting up shop in its territory. Besides this, the home of the Mt.Gox scandal might not be the best place for a platform like Binance.
Dubai
The UAE (especially Dubai and Abu-Dhabi) has been trying to promote itself as the Virtual Asset hub for the world over the last few years. Many top executives in the crypto sector have given credit to its legal framework. Binance is authorised to serve institutional and qualified investors in the country at the moment, so possibly the exchange could obtain a full license with the local authority VARA if needed. Dubai was also the home of the company's co-founder, CZ, who still has family in the country.
Unexpected candidate
Around one year ago, Binance established a blockchain hub in Georgia, which aims to be one of the most crypto-friendly countries in the world. Then, there was talk last August that Binance planned to leave Georgia already, as it didn’t manage to obtain a license. However, since then, we've heard nothing. Might it be that they are preparing a big surprise?
In the middle of nowhere
It is also possible that the exchange enters some kind of agreement with a country that is not on the list of the major crypto hubs. This new country might provide the company with beneficial conditions in return for investments, development of local infrastructure, educational or social initiatives, etc.
Binance was founded and initially based in China, before moving to Japan and then to Malta in 2018. Two years after the exchange was defined as a “Malta-based cryptocurrency company,” local regulators announced it was not under their jurisdiction. Since then, no official location has been named. CZ used to say that a decentralized company doesn’t need an office. He confidently claimed that “wherever he sits, is going to be the Binance office, and wherever he needs somebody, is going to be the Binance office.” Establishing official headquarters might be a signal that Binance truly changed its slightly rebellious principles and stood up on the path of correction.
