While Duba’s Virtual Assets Regulatory Authority (VARA) imposes rigorous crypto licensing procedures, industry insiders view the lengthy process as valuable. I reached out to crypto licensing professionals in Dubai for their perspectives on local regulations.
As a regulatory analyst, I’ve observed Dubai’s Virtual Assets Regulatory Authority (VARA) implement stringent regulations for the crypto sector. Although the licensing process is time-consuming, practitioners in this field consider it a valuable investment.
CryptoMoon reached out to cryptocurrency licensing professionals based in Dubai for insights on the specific regulations and procedures governing digital asset licensing in that region.
As a crypto investor, I’ve had the opportunity to engage with Tao Xiao, managing partner of NH Management, who shared some insights about VARA’s crypto licensing process during an interview with CryptoMoon. Based on his experience, he highlighted that this procedure can take up to a year. Having previously worked at Dubai’s Chamber of Commerce, Xiao emphasized the importance of paying close attention to detail and maintaining robust compliance measures throughout the process. In summary, as we navigate the world of crypto investments, it’s crucial to be aware that obtaining necessary licenses may involve a lengthy, meticulous journey.
“It’s an intricate and lengthy process. The process of obtaining the necessary licenses demands diligence and patience, as each aspect of the business undergoes scrutiny to ensure compliance with Anti-Money Laundering and Know Your Customer regulations.”
Xiao expressed Dubai’s unyielding dedication to upholding market integrity and protecting investor interests through its rigorous regulatory framework. By strictly enforcing Anti-Money Laundering (AML) and Know Your Customer (KYC) regulations, the Virtual Asset Regulatory Authority (VARA) instills robust procedures to minimize risks and prohibit unlawful activities in the digital currency marketplace.
In 2022, the Financial Action Task Force (FATF) added the United Arab Emirates (UAE) to its list of countries facing increased scrutiny for their efforts against money laundering and terrorist financing.
After being included on the list, the UAE implemented stricter regulations and legislations to counteract money laundering.
In February 2024, the jurisdiction was taken off the FATF’s gray list. This signifies that the country no longer faces increased monitoring by the Financial Action Task Force (FATF), headquartered in Paris.
Although obtaining a license in Dubai might pose a challenge, Xiao is convinced that it comes with numerous advantages. Furthermore, he emphasized that fulfilling the necessary prerequisites is not an insurmountable task.
“As of now, many projects are on the waiting list for VARA licensing, indicating that meeting the requirements doesn’t guarantee approval […] However, it’s essential to recognize that VARA’s objective is not to hinder progress but to ensure the safety and security of investors and the broader market.”
Xiao pointed out that businesses based in Dubai enjoy numerous advantages. Among these are easy access to international markets, attractive tax incentives, and a secure atmosphere fostering financial tech advancements.
Sam Blatteis, the CEO and co-founder of The MENA Catalysts, a government affairs firm, shared his perspective with CryptoMoon, emphasizing the benefits for businesses to establish a presence in Dubai.
“The government is gradually doing for crypto what Silicon Valley did for tech. The country is quickly becoming the Coachella of the crypto world.”
As a researcher studying economic development, I’ve discovered that despite its modest size, the UAE holds immense potential. With a high-income economy, pervasive financial services, and a substantial expatriate population, the country is experiencing exponential growth in cryptocurrency adoption.
For companies aiming to broaden their horizons in the UAE, Blatteis recommended undergoing a “thoughtful adjustment of strategies.” This entails studying the experiences of those who have successfully entered the market previously.
As a seasoned analyst, I would advise considering individuals who not only possess a solid background in legal matters but have also played pivotal roles in officially launching projects and securing successful outcomes for the company.
During an interaction with CryptoMoon at Token2049, Chainlink’s co-founder, Sergey Nazarov, expressed his strong impression of Dubai and the UAE. He elaborated:
“I think the regulation is increasingly progressive, and there’s a large collection of teams from all parts of the world, the West, the East, and kind of converging on Dubai as a place where they can do transactions, start firms, and build teams.”
Nazarov expressed a strong attraction towards Dubai’s government, regulatory environment, legal system, and economic conditions for our industry.
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2024-04-29 12:04