UAE To Begin New Crypto Licensing Process

By Kevin • April 18, 2023 2:33 pm • Comments

The United Arab Emirates continues to develop and streamline new regulatory guidelines which may favor the growth of the crypto industry within the region.

It was just announced that the UAR’s Securities and Commodities Authority (SCA) is soon accepting applications for crypto licenses.

The purpose of these licenses is to allow crypto firms provide digital asset relates services within the country once approved.

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This creates a standard process which may invite crypto capital and investments from all around the world to the region given the pro-crypto regulatory environment that exists in the country.

For example, ByBit, a major crypto exchange, just shared that it had entered the UAR by setting up headquarters in the country.

Watcher.guru reports:

The latest statement also noted how a green signal from the SCA wasn’t all that was required. In addition to receiving SCA permission, businesses wishing to conduct business in the Emirate of Dubai must also get a license from the Virtual Assets Regulatory Authority [VARA].

However, firms that are already licensed in the financial-free zones of the UAE are exempted.

Companies requesting licenses will primarily need to show “operational efficiency and flexibility.” Alongside, they have to adhere to a set of operational regulations. The statement further read,

“A person wishing to engage in virtual asset activities shall have headquarters in the State to conduct his business, according to one of the legal forms approved by the local authorities concerned with commercial licenses.”

It is expected that other regions that support crypto around the world will also eventually develop a similar legal process to allow crypto firms to enter their regions.

The UAE regulator has already shared that it will be accepting applications for all companies that deal with digital assets in any way.

Investors are expecting that many firms will take advantage of this new crypto licensing process in order to expand their presence overseas.

At the same time, it seems that this is an effective way to actually protect retail investors which is what the SEC had failed to do with companies like FTX.

BeInCrypto concludes:

VARA recently tightened its requirements for crypto firms seeking a license in Dubai. It probed Binance, the world’s largest exchange, for more information on its corporate structure and financial processes.

Earlier this month, Binance delayed plans to offer trading through its Binance FZE entity for operational reasons.

Bybit recently moved its headquarters to the Dubai World Trade Center after securing in-principle approval from VARA last year.

Other firms with Dubai licenses include Komainu, Hex Trust, and Crypto.com. However, Hex Trust held an Operational MVP license and was required to provide similar information, which it claimed posed no major hurdles to getting a license.

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