šŸ‘‹CZ Steps Down in Dubai,šŸŽ­Binance's Nigeria Drama,šŸ”Russian Innovation To Evade Sanctions

April 20, 2024

Your 5 minute emerging markets web3 weekly update

In This Issue

Asia
šŸ”øCZ Relinquishes Control of Binance's Dubai Unit To Secure Critical VASP License in the Emirate
šŸ”øDubai's Innovation: Franklin Templeton Partners with Medad Holding To Launch New Tokenized Financial Product

Africa
šŸ”øInternational Manhunt Update: Binance's Africa Manager Located in Kenya After Daring Escape From Nigeria
šŸ”øSouth Africa's Crypto Revolution Continues: VALR Secures Dual Crypto Licenses for Enhanced Trading Services

Eastern Europe
šŸ”øAmid Sanctions, Russian Businesses Developing Mechanisms for International Settlements Using Digital Assets
šŸ”øCryptocurrency Mining Surge in Russia: A Strategic Response to International Sanctions

Latin America and the Caribbean
šŸ”øB3 Unveils Game-Changing Tokenized Asset Solution for SME Crowdfunding in Brazil
šŸ”øBrazilā€™s CBDC Project Update: Not Production-Ready Yet, More Work Needed on User Privacy

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Asia

Image Credit: Dall-E 3

Binance co-founder, Changpeng ā€œCZā€ Zhao, agreed to give up voting control of Binance FZE, the company's Dubai unit, in order to receive a full Virtual Asset Service Provider (VASP) license in Dubai, although he remains the ultimate beneficial owner of the Abu Dhabi-based parent company. This critical license broadens Binance's market reach beyond institutional clients to include retail cryptocurrency trading, positioning it strongly in the Dubai market where competitors like OKX and Crypto.com have already secured similar status. Amidst overcoming substantial regulatory hurdles, including a $4.3 billion settlement with US authorities, the new license represents a pivotal recovery step, with CEO Richard Teng now intensifying efforts to reinforce global regulatory compliance.

Dubai-based Medad Holding and Franklin Templeton has signed a memorandum of understanding to launch a joint venture in the UAE, aiming to develop a novel tokenized digital asset known as 'yieldcoins', which combines the yield-bearing qualities of money market funds with the utility of a stablecoin. Franklin Templeton will provide the infrastructure and services through its BENJI tokenization suite, currently being used to manage the worldā€™s only tokenized U.S. Government Money Market Fund recorded on public blockchains. The initiative will be part of a new web3 entity under Medad Holding, leveraging yield farming techniques to provide a stable medium of exchange with growth potential through interest-bearing assets.

Africa

Image Credit: Dall-E 3

Nadeem Anjarwalla, the British-Kenyan Binance Africa Regional Manager, has been located in Kenya after escaping from Nigeria in late March. Efforts are underway by the Economic and Financial Crimes Commission (EFCC), INTERPOL, and the police forces of Nigeria and Kenya to extradite him to Nigeria. Mr. Anjarwalla faces charges in Nigeria over a $35.4 million money laundering case, which also implicates Binance and its American executive Tigran Gambaryan, who is Binance's Head of Financial Crime Compliance. Last week, Mr. Gambaryan pleaded not guilty to five counts of money laundering and was transferred to Kuje Correctional Centre, a prison facility that has, in the past, held inmates ranging from jihadists to politicians. Binance CEO, Richard Teng, stated at Token2049 in Dubai that the company is actively cooperating with Nigerian authorities to resolve the detention of Mr. Gambaryan.

VALR, one of South Africa's leading crypto exchanges, has obtained both Category I and Category II licenses from the Financial Sector Conduct Authority (FSCA), positioning it as one of the first platforms in the country to achieve full regulatory compliance as a Crypto Asset Service Provider (CASP). These licenses enable VALR to provide enhanced advisory and discretionary asset management services, ensuring robust consumer protection and adherence to stringent regulatory standards. Celebrated by VALR's Co-Founder and CEO, Farzam Ehsani, the achievement underscores VALR's commitment to compliance and security, reinforcing its position as a major player on the African continent and globally in the crypto industry. Last Week, South Africa launched its licensing regime, marking a significant advancement in the country's effort to establish a secure and sustainable regulatory environment for the South African cryptocurrency industry.

Eastern Europe

Image Credit: Dall-E 3

Russian businesses are advancing the development of mechanisms for international settlements using digital financial assets (DFAs), set to be operational within the year, as announced by Anatoly Aksakov, Chairman of the State Duma Committee on the Financial Market, at the "Payment Industry - Strategic Development and New Solutions" conference. Amid international financial sanctions, these new mechanisms aim to provide an alternative to the US dollar for global transactions and circumvent sanctions. Regulatory progress is underway in Russia to legalize and expand the use of digital currencies in international payments, with legislative actions expected to boost both cryptocurrency mining and experimental usage in international transactions.

Cryptocurrency mining in Russia is experiencing rapid growth, spurred by increasing interest from large corporations and the energy sector, amidst the nation's drive to develop a comprehensive regulatory framework. The Russian government is actively collaborating with the Ministry of Finance and the Ministry of Energy to foster a conducive environment for mining, aiming to utilize domestically mined cryptocurrency for international trade settlements. Amidst international sanctions, Russia views the mining industry as a strategic avenue to boost tax revenues and provide an alternative to traditional financial systems, highlighting the sector's potential to significantly impact the Russian economy and its global trade relationships.

Latin America and the Caribbean

Image Credit: Dall-E 3

B3 announced the launch of a tokenized asset solution designed to enhance crowdfunding platforms for small and medium-sized enterprises, focusing on more than 60 platforms regulated by Brazil's Securities and Exchange Commission (CVM). This innovative solution facilitates the tokenization of Collective Investment Contracts and other assets during primary fundraising, enabling subsequent market transactions of these tokenized assets, which is expected to significantly increase market liquidity and attract more investors. Developed in partnership with B3 Digitas and investment platforms Kria and EqSeed, this initiative marks a significant advancement towards enhancing investor security and broadening access in the rapidly evolving crowdfunding sector.

Fabio Araujo, coordinator of the Drex (CBDC) initiative at Brazil's central bank, highlighted at WebSummit Rio that while privacy solutions for the tokenized version of the Brazilian real are progressing, using technologies like Zether and Starlight, they won't be production-ready by mid-year, with a detailed report on the initial testing phase due then. These technologies aim to align the project with stringent banking secrecy laws to ensure user privacy. Araujo envisions that the Drex will facilitate public access to investing, such as purchasing government bonds, through improved smart contract management, significantly simplifying investment processes in Brazil.

Thanks for reading and have a great week ahead!

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Written by Jon Lira. Connect with him on LinkedIn.

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