Despite trying for a “decentralized headquarters,” Binance is stepping away from the idea following complaints from regulators who don’t see it with good eyes.
CZ, the CEO and co-founder of Binance, said that the idea that Binance represents a global, decentralized operation without headquarters is not to the liking of regulators.
“Four years ago when we started it, we wanted to embrace the decentralized model so we wanted to have decentralized teams everywhere. But we do run one centralized exchange, which is the biggest part of our business. Now we have come to realize that for the regulators, we need to be centralized.”
He mentioned how saying that Binance doesn’t have a headquarters can put it in a bad light:
“There are very simple questions regulators usually ask us [to] which our response is kinda funny. The regulators ask us where’s your headquarters, and our responses is, well, we don’t have headquarters. That doesn’t go well with regulators. They don’t know how to work with us. Sometimes they even think we are dodgy obviously.”
CZ further added:
“Regulators expect a centralized structure where it is set up. For the centralized exchange business, we need to be centralized. We need to have a centralized entity behind it with clear cap tables, clear investors, proper board, proper governance, very transparent KYC [know your customer], AML [anti-money laundering] and risk controls.”