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Why Did Middle East AI Investors Just Give Binance $2 Billion?
This deal is huge, and a little puzzling. It may also signal the next evolutionary step for crypto exchanges...
Adam Atlantic
March 14, 2025 • Estimated Reading Time: 4 minutes
A month ago, I wrote to you about Changpeng Zhao (commonly known as ‘CZ’), and Binance. Their rapid ascent from a start-up crypto exchange to a key pillar in the collapse of the FTX exchange, and then controversy around Binance operations that led to CZ doing a stint in jail.
The suit against Binance and CZ started in 2023, as the U.S. Commodity Futures Trading Commission (CFTC) filed a lawsuit alleging wilful evasion of U.S. laws and violations of derivatives regulations.
The agency accused Binance of inadequate checks and balances to prevent money laundering, and the knowledge of operations through their exchange of malicious actors.
Further compounding this, the U.S. Securities and Exchange Commission (SEC) charged Binance with multiple securities law violations. Including operating unregistered exchanges and mismanagement of customer funds.
The deck was stacked heavily against CZ, and in November 2023, Binance and CZ pleaded guilty to federal charges. Including violations of the Bank Secrecy Act and operating an unlicensed money transmitting business.
As part of the settlement, Binance agreed to pay a record $4.3 billion fine, CZ personally paid $50 million and resigned as CEO. This also included the four months in prison, which he’s now served.
Had Binance been a publicly listed company, the stock price rollercoaster would have been wild! But thankfully for Binance’s sake, they’re not. And with the clear-out of these charges, the removal of CZ and the implementation of new(ish) CEO, Richard Teng, Binance has been going through the proverbial house cleaning over the last year.
$2 Billion to Get Started
This clean-up has paid off, big time.
Announced yesterday, Abu Dhabi's MGX investment group has invested $2 billion in Binance.
As the joint-Binance-MGX announcement explains,[1]
This transaction, the first institutional investment in Binance to date, marks a significant step in advancing digital asset adoption and reinforcing blockchain’s role in global finance. It is also the single largest investment into a crypto company and the largest investment ever paid in crypto (stablecoin).
MGX, only established in 2024, is an artificial intelligence-focused fund from Abu Dhabi, chaired by Sheikh Tahnoon bin Zayed al-Nahyan.[2]
This deal is huge, and a little puzzling. It may also signal the next evolutionary step for crypto exchanges.
You see, MGX is an advanced technology and AI fund. As they say on the MGX site,[3]
MGX is a leading AI and advanced technology investor committed to accelerating the responsible development of AI-led technologies that will deliver a positive economic and social impact.
They point out their approach to investing is in AI Chips, Data Centres, Clean Energy, Connectivity and AI Technology.
Source: MGX[4]
Yet, here they are dropping $2 billion into the world’s largest crypto exchange.
AI for Crypto Exchanges?
Or should we say the world’s largest crypto data feed? Or the world’s largest crypto data centre?
Or will we be saying in a couple of years’ time, the world’s largest AI-enabled crypto exchange?
Think about logging into your Binance account, to tweak your AI agent that trades and invests for you, 24 hours a day, seven days a week, to maximise your crypto returns.
Maybe that’s the real play here. They talked about blockchain and digital finance in the press release. But my take is that if Binance has the data, and MGX has links to the AI, then maybe Binance is just fuel for the AI that’s coming for crypto exchanges.
Trading, investing, transacting faster, smarter, more profitably than humans can…that’s what AI could bring to crypto markets. And if my suspicions are right, this deal is far more about AI and data than blockchain and digital finance.
Trust in crypto,
Adam Atlantic