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Podcast: Crypto Pirates
Episode:

Dubai’s new crypto framework has the potential to position the city-state as a regional leader
Category: Technology
Duration: 00:03:34
Publish Date: 2022-03-10 04:05:53
Description:

In the Middle East, Dubai is becoming a burgeoning crypto hub. 

The UAE Prime Minister wishes to position the UAE and Dubai as key players in shaping the global future of virtual assets. 

The Dubai Virtual Assets Regulatory Authority will authorise and monitor the operation and management of cryptocurrency platforms, virtual asset custody, and transfers. 

Sheikh Mohammed bin Rashid Al Maktoum, Ruler of Dubai and Prime Minister of the UAE, made two major crypto-related announcements on Twitter. Aside from approving the first virtual assets law, the Dubai Virtual Assets Regulatory Authority has been designated as the sector's supervisor. 

Dubai has recently emerged as a vital cryptocurrency hub for both investors and creators. It is worth noting that the hotspot has hosted several crypto conferences in the past year, with the upcoming Crypto Expo scheduled to take place this month. 

Furthermore, as the Middle East's financial capital, the UAE is the region's third-largest crypto market, trailing only Turkey and Lebanon, according to Chainalysis data from July 2020 to June 2021. 

The goal, according to Mohammed bin Rashid, is to "establish the UAE and Dubai's position as a key player in designing the global future of virtual assets." 

Meanwhile, Binance, the world's largest cryptocurrency exchange by volume, is rumoured to be interested in obtaining a licence in Dubai. Binance recently received in-principle approval from Bahrain's central bank to become a crypto service provider as part of its Middle Eastern expansion. 

The Dubai Virtual Assets Regulatory Authority will use the new rules to authorise and supervise the operation and management of crypto platforms, virtual asset custody and transfer, and price manipulation in space. The regulator's responsibilities will include, among other things, the protection of investor data. 

The announcement comes just one day after the UAE's Securities and Commodities Authority (SCA) stated that a new framework will ensure AML/CFT compliance across the region. It includes reducing the risks of money laundering and terrorist financing, as well as adhering to the Financial Action Task Force's (FATF) recommendations and requirements, according to the watchdog. It is worth noting that, until recently, the SCA was the sole authority in charge of supervising and overseeing virtual asset activities and services in the UAE. 

According to Reuters, VARA will oversee the virtual asset space in Dubai in the future, but it excludes regions within the state-owned financial free zone DIFC. According to reports, the FSA will oversee the DIFC. 

The DWTCA's director-general, Helal Saeed Almarri, stated that the new law and the appointment of a sector regulator will strengthen the UAE's and Dubai's position by attracting global leaders. He went on to say: "In collaboration with the Central Bank of the UAE and the Securities and Commodities Authority, the Dubai Virtual Asset Regulatory Authority will offer a full range of VA [virtual asset] services."

 

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