Binance, the largest cryptocurrency exchange said it has received a $2 billion investment from Abu Dhabi’s MGX, which is primarily an AI investor. MGX says it wants to enable innovation at the intersection of AI, blockchain and finance. This is the first institutional investment that Binance has received, and the payment used stablecoins.
It follows a massive $4.3 billion penalty and forfeiture levied in late 2023 by the United States Department of Justice for anti-money laundering (AML) and Bank Secrecy Act violations. While $2.7 billion should have been paid by now, $1.8 billion was due around late February. If the payment had been later, it may have been part of the US Digital Asset Stockpile.
As part of the deal, founder Changpeng Zhao (CZ) stepped down and was replaced by Richard Teng.
Teng was previously CEO of the Abu Dhabi Financial Services Authority. Around 1,000 of Binance’s 5,000 team is based in the UAE. As part of today’s announcement, the company revealed it has 260 million registered users and has processed more than $100 trillion in transactions.
“MGX’s investment in Binance reflects our commitment to advancing blockchain’s transformative potential for digital finance,” said Ahmed Yahia, Managing Director & CEO, MGX. “As institutional adoption accelerates, the need for secure, compliant, and scalable blockchain infrastructure and solutions has never been greater. Binance has long been a driving force in cryptocurrency innovation, from exchange technology and tokenization to staking and payments.”
The investment is for a minority stake.
Who is MGX?
MGX was founded last year to invest in AI and advanced technologies, including semiconductors, AI infrastructure and AI technology. Its Chairman is the deputy ruler of Abu Dhabi, HH Sheikh Tahnoon Bin Zayed Al Nahyan. The Deputy Chairman is the group CEO of the Mubadala sovereign wealth fund (AUM $300billion+), HE Khaldoon Al Mubarak. CEO Ahmed Yahia Al Idrissi was previously CEO of Direct Investments at Mubadala.
Mubadala recently invested $437 million in Bitcoin via BlackRock’s IBIT ETF.
The board has one crypto link – Peng Xiao used to be CTO and CIO at MicroStrategy, where he spent 15 years. However, he left in 2014.
Late last year MGX inked the Global AI Infrastructure Investment Partnership (GAIIP) with BlackRock, Microsoft and Global Infrastructure Partners (GIP). Larry Fink, Chairman and CEO of BlackRock, signed the deal in person.
