For MGX, the investment seeks to explore the fusion of AI and Web3.
Binance claims to have 260 million registered users globally
Photo Credit: Binance
Binance has sold off a minority stake to Abu Dhabi-based MGX for $2 billion (roughly Rs. 17,403 crore). MGX is a sovereign wealth management fund led by Sheikh Tahnoon bin Zayed Al Nahyan of the Abu Dhabi royal family. With a focus on advanced tech investments, MGX has funded a bunch of promising AI projects so far. Its purchase of a minority Binance stake marks MGX's first foray into the Web3 space.
Changpeng Zhao, the co-founder and the majority stakeholder of Binance announced the development on X on Wednesday, March 12. “This is the first institutional investment Binance has taken,” he posted. Zhao highlighted that MGX's financial transaction will be facilitated using stablecoins, making it the largest ever crypto transaction.
For MGX, the investment is aimed at exploring the amalgamation of AI and Web3. Binance, in its announcement post, claimed that the wealth fund wishes to dive deeper into AI-powered blockchain solutions, decentralised finance (DeFi), and the larger tokenised digital economy.
“As institutional adoption accelerates, the need for secure, compliant, and scalable blockchain infrastructure and solutions has never been greater,” said Ahmed Yahia, MGX's CEO and Managing Director. “MGX's investment in Binance reflects our commitment to advancing blockchain's transformative potential for digital finance.”
Rumours about Binance seeking a buyer had started making rounds in the crypto industry back in February. Zhao had dismissed the speculations at the time and claimed that Binance may overtime consider selling minority stakes in “single digit percentage range.”
Binance has yet to disclose the percentage of company stake acquired by MGX in the investment.
Commenting on the development, Binance CEO Richard Teng said, “Our goal is to build a more inclusive and sustainable ecosystem, with a strong focus on compliance, security, and user protection.” Teng, who replaced Zhao as the Binance CEO in November 2023, previously served as the CEO of the Abu Dhabi Financial Services Authority.
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