Under pressure from regulators around the world, major exchange Binance is looking to establish headquarters in Ireland. Until now, it has operated globally for years under what its CEO, Changpeng Zhao, has described as a “decentralized” structure.
A Wednesday report from Irish media outlet Independent noted that Binance had established three subsidiaries in the country on Sept. 27 — Binance (APAC) Holdings, Binance (Services) Holdings and Binance Technologies — with Zhao listed as the director for each.
In an interview with Reuters published on Thursday, Zhao stated that Binance is currently “in the process of establishing a few headquarters in different parts of the world.” When asked if Ireland was part of Binance’s plans for formal headquarters, he responded, “Yes, it does.”
“Historically, we claim that we don’t have headquarters,” said Zhao, adding:
“When we first started we wanted to embrace the decentralized principles, no headquarters, work all around the world, no borders. It's very clear now to run a centralized exchange, you need a centralized, legal entity structure behind it.”
Binance’s move to bolster its compliance comes as regulators around the world have taken action to limit the services provided by the exchange or warn their citizens against trading on the unlicensed platform.
Binance’s corporate structure has long been opaque, with Reuters reporting that its holding company is registered in the Cayman Islands.
After being founded in China in July 2017, Binance quickly found itself playing regulatory arbitrage around the world after the Chinese government launched a crackdown on domestic crypto exchanges that year. Binance quickly moved its headquarters to Tokyo before expanding into Hong Kong and Taiwan.
Binance turns to Malta
Binance had expressed its intent to launch operations in Malta in March 2018, with then-Maltese Prime Minister Joseph Muscat personally welcoming the firm on social media. Binance went on to register its charity and European services subsidiaries in the island nation.
Despite the Malta Financial Services Authority (MFSA) announcing in July 2018 that it was still working on a regulatory framework for licensing crypto firms, the exchange appeared to become very cozy with the local administration.
Zhao frequently appeared alongside government officials, and former Maltese President Marie-Louise Coleiro Preca was appointed to the senior advisory board of both Binance Charity and the Binance-backed Blockchain Charity Foundation.
Related: New Malta Government Says It Still Wants to Run a ‘Blockchain Island’
In February 2020, the MFSA announced that local reports claiming Binance to be a Malta-based exchange were false, asserting that “Binance is not authorized by the MFSA to operate in the cryptocurrency sphere and is therefore not subject to regulatory oversight by the MFSA.”
While the reports appeared to catch much of the media and crypto community off-guard, Zhao took to Twitter, asserting that “nothing has changed in Malta, for Binance or any other crypto exchanges. No licenses were granted to anyone by Malta, as of yet.”
In July of this year, the MFSA issued a fresh warning emphasizing that Binance is not licensed to operate in Malta.