According to a government official, the United Arab Emirates (UAE) is preparing to issue federal licenses to virtual asset service providers (VASPs).
According to an anonymous source from Bloomberg, the Securities and Commodities Authority is finalizing legislation that will enable VASPs to begin operations by the end of the first quarter. A national licensing regime for crypto service providers could help the UAE compete with rival financial hubs such as Singapore and Hong Kong, which have already established themselves as a global crypto hub through the crafting of workable regulatory frameworks. are. The UAE official also said that the government hopes to develop an ecosystem for crypto mining, which he said will be regulated.
Incidentally, some permits have already been issued for VASPs within financial free zones in the UAE, including 22 for the Dubai Multi Commodity Centre, six for the Abu Dhabi Global Market and at least one for the Dubai Silicon Oasis Authority. The Dubai International Financial Centre, a Middle East hub for most Wall Street banks, currently has no shortage, while fewer include 1.
market report
Prudently, the United Arab Emirates last year conducted a risk assessment on VASP, which included 14 public sector agencies and 16 private sector actors. Despite the “high risk” that VASPs could be used to finance illicit finances, the government concluded that appropriate regulation, rather than outright prohibition, would better mitigate those threats, the report said. has gone.
According to the report, Dubai-based crypto exchange BitOasis is currently the largest UAE VASP, but competition is increasing.
Binance Holdings Ltd., the world’s largest cryptocurrency exchange by trading volume, is looking to increase its presence in the country. Binance has now formed a local team, after already helping the Dubai World Trade Center Authority develop regulations for a new cryptocurrency hub. As chief executive officer, Changpeng “CZ” Zhao has quickly become a fixture in the city, there have also been talks of setting up a potential headquarters.
Other regional players include Coinmena BSC and Rain Financial Inc., while San Francisco-based exchange Kraken is currently seeking a CEO for Middle East North Africa based in Abu Dhabi.
According to data from Chainalysis, with a growth of 1,500% over the past year, the UAE has now become the third largest crypto market in the Middle East after Turkey and Lebanon, with a transaction volume of approximately $26 billion.
What did you think of this topic? write to us and let us know,