Oman Central Bank reviews stance on crypto in its 3rd meeting for 2023

Oman Central Bank reviews stance on crypto in its 3rd meeting for 2023

In a news piece on Oman News agency, the Board of governors of the Central Bank of Oman, held their third meeting for 2023 where the followed up on developments as well as reviewed the international stance on cryptocurrencies as well as related studies conducted by the executive management team at the central bank on cryptocurrencies.

This comes as Oman works on its virtual asset regulations, having  at the end of July 2023 announced a public consultation paper on virtual assets regulatory framework by the Oman Capital Market Auhtority.The Capital Market Authority, Sultanate of Oman (CMA), which regulates and develops Oman’s financial markets for the capital market and insurance sectors, had earlier announced its plans to establish the new regulatory framework for Virtual Assets (VA) and Virtual Asset Service Providers (VASP).The proposed new regulatory framework is envisaged to cover activities such as crypto assets, tokens, crypto exchanges, and initial coin offerings, among others. CMA had invited relevant stakeholders to provide their views and comments no later than mid August 2023.Oman has also been at the forefront of crypto mining in the region and in August 2023 announced the first phase of Asyad Group crypto mining center was launched in the Free zone in Salalah. Built and managed by Exahertz, a subsidiary of Afaq Advance Technologies firm, the first phase was inaguarated during a ceremony attended by top Omani governmental officials. Later on in the same month Oman-headquartered Green Data City and Abu Dhabi’s Phoenix Group have signed an agreement to develop a 150MW crypto-mining farm in Oman. The new farm will be set up in Green Data City and should be fully operational by Q2 2024, becoming one of the largest crypto-mining data centres in the region.Even in June 2023 the Oma Capital Markets Authority published a decision with regards Instructions for registering virtual asset service providers and applying AML/CFT requirements.So it would seem that while the Central Bank of Oman is reviewing cryptocurrencies both from a local and international perspective, the country is moving forward with its crypto and virtual assets plans.

India’s CoinDCX investment into UAE BitOasis crypto broker breaths new life into the company

India’s CoinDCX investment into UAE BitOasis crypto broker breaths new life into the company

UAE based BitOasis crypto broker exchange has announced that it has secured an investment from CoinDCX, India’s biggest crypt exchange. This comes after BitOasis’s license was suspended by VARA for not meeting requirements. The latest investment will give BitOasis a new life line.

As per the news, the new capital injection will help to support BitOasis’s vision to amplify its regional presence and secure further licenses in the region.

Commenting on the news, Ola Doudin, Co-Founder and CEO of BitOasis said: “We are delighted to be working with CoinDCX, India’s leading crypto platform. From our first conversations, it was clear we share a common vision and synergies across our markets that we look forward to building towards. The investment will allow us to sharpen our focus on perfecting our existing products and expanding across our markets. We are very excited about the opportunities the funding will unlock for us.”

Sumit Gupta, Co-Founder and CEO of CoinDCX stated: “We are immensely excited about investing in BitOasis, the largest crypto trading platform in the Mena region. We have been impressed by BitOasis’s excellent product offering, strong leadership and their persistence to serve customers in the most secure and compliant manner.”

The investment comes after news that CoinDCX was in talks to acquire BitOasis. BitOasis in the past month had let go of more than 30 employees.

Prior to that VARA had freezed BitOasis’s MVP operational license for non compliance to requirements set by the Dubai virtual asset regulator. 

With this an Indian crypto exchange now has a foothold in the MENA region with the investment in BitOasis. 

Blockchain Security auditor Hacken partners with Dubai Blockchain Center

Blockchain Security auditor Hacken partners with Dubai Blockchain Center

Ukraine headquartered Hacken, a blockchain security auditor that aims to make Web3 a safer place, has partnered with Dubai Blockchain Center.

As per a Hacken team tweet, “ This is a pivotal step towards accelerating blockchain adoption in Dubai and ensuring enhanced security in the tech scene.”

Igor Hacken, Business Development Manager at Hacken tweeted, “Very proud moment for hackenclub expanding into the UAE joining the efforts of keeping the blockchain secure with Dubai Blockchain Center and  Dr. Marwan Alzarouni. Stay tuned to learn more about all of our contributions in to the rapidly growing region.”

The  collaboration will also include providing  mentoring, education on blockchain security and contributing to the development of regulatory requirements for project licensing.

Hacken offers various solutions including smart contract audit, proof of reserves, and others. In February 2023, Hacken researchers identified a bug in the Binance zkSNARK-based Proof of Reserves system which was then resolved with Binance team.

Since their inception in 2017, they have carried out 1200 audits.

This is not the first collaboration in the region. Prior to this Hacken launched a virtual Hackathon in May 2023 with UAE based Venom Foundation with a pool prize of $225,000.

Most recently Hacken’s CEO and Co Founder, Dyma Budorin published a research conducted by CER one of their partners which revealed that 70% of crypto wallets have security gaps, exposing digital assets to vulnerabilities.

The presence of Hacken in the UAE, looks to benefit the blockchain ecosystem as a it creates more awareness on digital assets auditing and security.

Blockchain Research Institute partners with Saudi IR4LAB to spur Blockchain adoption in KSA

Blockchain Research Institute partners with Saudi IR4LAB to spur Blockchain adoption in KSA

The Blockchain Research Institute – Middle East (BRI-ME), the exclusive partner of The Blockchain Research Institute, an independent, global think tank, dedicated to exploring and sharing knowledge about the strategic implications of blockchain on business, government, and society co-founded by Dr Don and Alex Tapscott, has signed a partnership agreement with KSA based IR4LAB, a Saudi-based company specialized in disruptive technologies such as Blockchain and Artificial Intelligence, to develop and spread the blockchain adoption in Saudi Arabia and the MENA region.

The signing ceremony was held under the auspices of the Saudi Arabia’s Ministry of Communication and IT (MCIT) in Center of Digital Entrepreneurship (CODE) Riyadh headquarters. In attendance live from Canada was Dr Don Tapscott, well renowned global blockchain author and expert, and founder of BRI.

Key representatives from several Saudi governmental and private entities were present including MCIT, Communications space & Technology Commission, Saudi Aramco Entrepreneurship, Plug and Play as well as the Canadian embassy.

Both BRI-ME and IR4LAB will work together to collaborate in the area of blockchain technology research, consulting and development of solutions, use cases, as well as cooperate to organize blockchain events, training programs and workshops in the Kingdom and the MENA Region.

Majd AL AFIFI Co-Founder and CEO of IR4LAB, stated,”We are very proud of this partnership; it will bring much needed collaboration and cement Saudi Arabia’s position in Blockchain technology.”

Mohamed EL KANDRI Co-Founder and CTO of IR4LAB added, “Partnering with the largest Blockchain Think tank in the world is a landmark development for Blockchain adoption in the region, and we are happy to lead the way alongside likeminded partners”

Aline Daoud, Managing Partner and Founder at the Blockchain Research ME, said, “We are proud to join forces with IR4LAB who have been revolutionizing the Blockchain adoption in the Kingdom and the region. Together we will be fostering, growing, and supporting the interest in the blockchain technology in the country as we offer our joint trainings, research, events and consultancies. “

BRI-ME and IR4Lab took the opportunity to announce about the first upcoming event in Riyadh which will take place on the 19th of October 2023, The Web3 Summit: Blockchain and Beyond, will be a private event covering Blockchain for Oil & Gas, Banking & Finance, Supply chain & logistics, Smart Cities and Women in Web3. Dr Don Tapscott will be flying in all the way from Canada to address the audience with a 45-min keynote speech for the first time in Saudi Arabia. (More on the event can be found: https://web3summit-ksa.com/)

This comes after IR4LAB announced its expansion into Africa. 

Oman’s Green Data City to have full blockchain capacity in 2023

Oman’s Green Data City to have full blockchain capacity in 2023

Oman’s Green Data City, the first data center in Oman to obtain a crypto mining license will have full blockchain capacity in 2023. The datacenter which is nestled in Salalah region of Oman, harnesses its coastal location to utilize renewable energy sources.

As per a report in Oxford Business group, the project is set to receive more than $3.2 billion as part of Vision 2040 and is expected to reach full blockchain capacity in 2023.

The MTCIT announced in December 2022 that it secured OR150m ($390m) in investment from a consortium of local and foreign financiers to develop a large-scale data center at Green Data City. The investment is earmarked for the processing and hosting data; and the adoption of distributed ledger technologies, blockchain and financial technology.

In an interview with Said Abdullah Al Mandhari ,CEO of Oman ICT Group, he noted that advanced technologies and blockchain, in particular, have enormous potential to enhance Oman’s long-term economic development, especially considering the current business environment.

He added, “Artificial intelligence (AI), big-data analytics, blockchain and the internet of things (IoT) can boost efficiency and productivity in various sectors, such as finance, education, health care and logistics. It will be important for the energy sector in particular to adopt advanced technologies to increase productivity and align with long-term sustainability standards.”

For his part, Blockchain could be used to provide platforms that manage digital assets and conduct transactions while reducing fraud risks, increasing transparency and streamlining related operational processes. Blockchain would also be able to expand inclusion in the financial ecosystem, as it enables crowdfunding and peer-to-peer lending for small- and medium-sized enterprises.

The report reiterates that the Oman regulator has announced the development of a regulatory framework for virtual assets and virtual asset service providers. This will help underpin the development of the digital asset and financial technology industry in the sultanate.

By regulating virtual assets, the Capital Market Authority aims to provide an alternative financing and investment platform for issuers and investors alike, while mitigating the risks associated with this asset class. The framework will cover activities such as crypto-assets, tokens, crypto-exchanges and initial coin offerings, among others.

UAE based Aquanow, digital assets infrastructure provider receives initial approval from Dubai’s VARA

UAE based Aquanow, digital assets infrastructure provider receives initial approval from Dubai’s VARA

Aquanow, a digital assets infrastructure provider has unilaterally announced that it has received initial approval from Dubai’s Virtual Asset Regulatory Authority (VARA), while it undertakes the in-depth process of applying for a license in accordance with VARA requirements.

Full approval to operate will be issued by VARA as soon as Aquanow completes all mandated requirements, which the firm is expected to complete in the near-term.

“At Aquanow, we believe that the UAE is a forward-thinking jurisdiction for digital assets regulation and we view Dubai as a key hub for our international growth efforts,” said Aquanow’s Chief Executive Officer, Phil Sham. “We’re excited to receive the initial approval from VARA and to be moving closer to powering a range of digital asset use cases in the region.”

Aquanow, which is privately-backed, is one of the largest digital asset liquidity providers and is a global leader serving financial services clients in 40 countries around the world. Aquanow is rapidly expanding in the Middle East, and the UAE is an emerging hub of Web 3.0 innovation with more than 500 crypto companies based in the country.

Established in 2018, Aquanow currently has 90+ team members with offices in Canada, Dubai, and Singapore.

UAE regulated virtual assets activities now offered at Department of Economy and Tourism branches

UAE regulated virtual assets activities now offered at Department of Economy and Tourism branches

In a recent announcement by Dubai’s virtual asset regulatory authority ( VARA), the Department of Economy and Tourism is now offering regulated virtual assets activities in its branches.

This means that Virtual Asset Service Providers (VASPs) seeking to conduct business in Dubai’s mainland or make changes to their current commercial licenses may submit their applications for the below-mentioned activities at DET branches.

The list of Regulated Virtual Assets Activities (require a license from VARA) include, VA Advisory Services,  VA Broker-Dealer Services,  VA Custody Services,  VA Exchange Services, VA Lending and Borrowing Services and  VA Management and Investment Services. In addition to VA propriety trading which requires a NOC from VARA. 

Firms carrying on VA activities in Dubai [except DIFC] prior to 7 February 2023 [Legacy VASPs], must have their applications seeking regulatory oversight or relevant guidance from VARA by the final deadline of 30 April 2023.

As per the announcement, firms that have failed to comply with the regulatory framework by the aforementioned deadline must comply immediately to avoid substantial punitive measures including material fines/penalties and potential firm closure.

DET Centres offering commercial licences for the Regulated Virtual Assets Activities are available in – Al Barsha Mall, DED Café, Palm Strip Mall Jumeriah,  Al Twar Centre , Dubai Mall and  Clock Tower Deira

Singapore based crypto asset custodian applies for license in ADGM

Singapore based crypto asset custodian applies for license in ADGM

According to a recent news piece in Khaleej Times, Liminal, a crypto custodial wallet platform has applied for a license at Abu Dhabi Global Market (ADGM) in an effort to offer regulated service in the region.

Liminal which claims to have processed crypto transactions worth $5.6 billion on its platform, with over $550 million worth of assets under protection, believes that people will use digital assets either as part of investment or a part of underlying fundamental technology.

Mahin Gupta, Founder, Liminal stated to Khaleej Times, “Regulation will become uniform across the globe. UAE has taken a first mover advantage in the field of digital asset regulation, with much clarity. They have a clear idea about how they want to look at Metaverse, how they want to look at trading, how they want to look at custody and how they want to look at blockchain as a service and blockchain as a platform for other applications.”

Liminal in the past month has advertised for the position of Finance Officer based out of Abu Dhabi ADGM.  Prior to that Liminal partnered with Dubai based payment gateway platform Magik Labs. Through this partnership, Liminal would empower Magik Labs to create a series of transit payment wallets to receive payments from their users. These payments will then be converted to desired tokens or NFTs via connectivity to other decentralized exchange (DEX) aggregators, over the counter (OTC) desks or trading platforms. Liminal’s MPC hot wallets will enable transit wallet addresses and provide automation of transaction flows.

At the time, Manan Vora, senior vice president, strategy and operations at Liminal had noted, “Our partnership with Magik Labs is a part of our continued efforts to strengthen Liminal’s position in the Mena region as the first choice of businesses for digital wallet infrastructure services.”

According to Gupta there are about 400 digital asset businesses in the UAE, and this number will cross 1000 by the end of 2023.

Liminal is focused on Asia-Pacific and Mena regions, and is running on an accelerated growth trajectory by growing aggressively in client acquisition, especially in markets like South Korea, Hong Kong, Japan, Africa (Nigeria), Indonesia, India and Dubai.

Dubai Virtual Asset regulator CEO speaks on the current and future status of regulations at VARA

Dubai Virtual Asset regulator CEO speaks on the current and future status of regulations at VARA

During DACOM (The Digital Asset Compliance and Market Integrity Summit) hosted by Solidus Labs, a crypto-native market surveillance and risk monitoring hub tailored for digital assets, in Abu Dhabi on May 4th 2023, Dubai’s virtual asset regulator CEO stated that only 50 percent of Dubai’s legacy VASPs (those who were operating before VARA was set up) applying for license at VARA will need to be regulated. He also talked about the opportunity to launch regulation and compliance as a service for small business and entrepreneurs.

Henson Orser, CEO of Dubai’s Virtual Asset Regulatory Authority, VARA, discussing VARA’s licensing journey with strong legal risk compliance, stated, “Currently we have three cohorts that are passing through several processes and routes to being fully licensed, the Minimum Viable product cohort that includes global operators who were with us from day one.  There are also legacy VASPs (Virtual Asset Service Providers), several hundred of them who have been performing virtual asset activities in Dubai before VARA came along. We are in the process of registering them and believe half of them will need regulatory licenses.” He mentions that there are also new applicants who will join the regulatory process going forward.

Orser added, “VARA is offering a nuanced approach to virtual asset regulation that does not need to define a token or coin as a security or commodity to fall into an existing framework but covers any activity in a way that affords investor protection and have compliance in such a way that we hope other global regulators would be comfortable with by design and principle.”

According to Orser, VARA is currently looking at several hundred VASPs within their ecosystem which entails a lot of compliance and risk officers, as well as general counsels and legal advisors. He mentions given the fact that there are many micro businesses and entrepreneurs there is a great opportunity for regulation and compliance as a service offering. As he states, “Regulation and compliance as a service offering will mutualize cost and leverage expertise.” 

Orser believes the most important thing is that VARA is building a hub of global financial services with innovation and technology at the cross roads of the world including within it a strong compliance risk management and legal framework which he says “ VARA will stand out as a foundational principle and will be a thriving fixture of the community.”

As for the future, Orser states that from a regulatory standpoint once there is a steady state on licensing, supervision, and enforcement for the three existing cohorts today, VARA given it is technology agnostic and a promoter of innovation, will launch a regulatory sandbox to have a framework for product development of the future.

He states that the future will include tokenization of real world assets, including real estate, as well as micro financing, royalty rights for creators and publishers, with smart contracts for movies /music, permissioned DeFi (Decentralized Finance), gaming and the metaverse. Here he sees, “A billion users will start to challenge the boundaries of title and value” and finally interoperability, transfers identity and more.

In his final words he believes that many innovators and developers are coming to Dubai because of the growth oriented environment and open minded regulator which encourages compliant operators without sacrificing core principle of investor protection, FATF Compliance and risk. Accordingly he believes, “Blockchain technology is here to stay and its applications will infiltrate more than we can imagine same goes for gaming metaverse and all things Web3.”

Decentralized Autonomous Organizations will soon have a home in UAE ADGM

Decentralized Autonomous Organizations will soon have a home in UAE ADGM

UAE Abu Dhabi Global Market’s registration authority is seeking to develop regulations for DLT ( Distributed Ledger Technology) decentralized autonomous organizations and has started with the issuance of a consultation paper seeking replies before May 12th 2023.

For the proposed Distributed Ledger Technology Foundations Regulations 2023, ADGM is seeking public feedback and comments on the proposed new legislative framework for foundations that facilitate Distributed Ledger Technology (DLT) and token issuance (DLT Foundations).

As per the announcement, the Consultation Paper is of interest to any persons operating or planning DLT projects, persons engaging in digital asset related activities and their legal advisors, as well as DLT industry participants, associations, and stakeholders.

The RA’s key proposals for the Distributed Ledger Technology Foundations Regulations cover: the structure of the DLT Foundations; governance and control; tokens; reporting, disclosures and publication; beneficial ownership; supervision; insolvency and liquidation / voluntary strike off.

This new legislative framework showcases ADGM RA’s recognition of the overall suitability of foundation structures for DLT projects, and the RA’s alignment with ADGM’s strategy to facilitate and support crypto initiatives.

ADGM had received interest concerning the use of ADGM foundations for DLT purposes and the issuance of non-regulated utility tokens. However, whilst foundations are inherently well suited to DLT projects, there are certain features and requirements within ADGM’s current foundations regimes that impose constraints that are not desirable for DLT projects.

The ADGM registration authority, recognizing the overall suitability of foundation structures for DLT projects, seeks to facilitate and support crypto initiatives, as such decided to prepare a new legislative framework to cater for DLT projects and token issuance.

Decentralization is a core principle of many DLT projects, which prizes the transfer of authority and control away from centralized entities or groups to a distributed network of project participants. The perceived advantages of decentralization are rooted in this idea of decentralized governance, which its advocates believe promises a number of benefits, including more equitable ownership and value distribution among stakeholders, insulation from the vested interests of particular individuals or groups, reduced risk of censorship, and greater diversity.

So for these kinds of DLT projects, the concept of the “decentralized autonomous organization” (DAO) has emerged as the ideal-type governance structure.