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

World Economic Forum calls UAE crypto regulatory framework as agile and benefiting innovation

World Economic Forum calls UAE crypto regulatory framework as agile and benefiting innovation

World Economic Forum report entitled “  Pathways to the Regulation of Crypto-Assets”  says UAE crypto asset regulatory framework is an agile one,  defining it as flexible, iterative and proactive which is beneficial because it is flexible, appreciate market maturity and ecosystem development.

According to the WEF report, regulators that fall under this model include the Swiss Financial Market Supervisory Authority. FINMA’s token classification prescribes three simple categories: payment tokens, utility tokens and asset tokens. The framework acknowledges hybrid tokens and that a token’s classification may change over time. Following the first classification, FINMA later also published further guidance in

Also included as per the report are the regulatory sandboxes in the EU and India in addition to the UAE. 

Instead of prescribing and enforcing rules, agile regulation adopts a responsive, iterative approach, acknowledging that policy and regulatory development is no longer limited to governments but is increasingly a multi-stakeholder effort. Yet it also faces challenges that include the need for coordination and collaboration being as well plagued with uncertainty. 

Regulatory sandboxes, guidance and regulators’ no-objection letters are all forms of agile regulation that enable the testing of new types of solutions, iterating policy frameworks based on ecosystem evolution and industry needs.

The report sets out to understand and highlight the needs and challenges in developing a global approach to crypto-asset regulation. In doing so, it delves into the various regulatory approaches being adopted by different jurisdictions.

The report developed rankings for each regulatory framework. The rankings covered four areas when analyzing regulatory frameworks and found that the agile regulatory framework is best at promoting innovation. Agile regulatory framework ranks in the middle ground for providing certainty for businesses, addressing data gaps and enforcement effectiveness.

The report finds for example that Regulation by enforcement which the USA falls under is weak in all the above mentioned areas except for enforcement effectiveness.

As per the report the UAE has not only initiated a license regime for crypto assets, but has also carried out consultation for decentralized applications such as DeFi, and DAOs.

In addition the report mentions that few jurisdictions have chosen to address the difficulty of classifying tokens, partially relying instead on the functionality enabled by the token.

For example, Liechtenstein has chosen not to rely solely on classifications but to introduce the token as such as an element in Liechtenstein Law, meaning that the right or asset represented in the token triggers the application of special laws (the so-called “token container model”). This means that the tokenization as such has no legal effect: if a financial instrument is tokenized, the financial market laws are applicable if the activity is regulated, too; if a commodity is tokenized, the laws for commodity trading might be applicable; and so on. For new instruments, such as utility coins and virtual currencies, a new regulation has to be defined.

While in the UAE, the Virtual Assets Regulatory Authority in Dubai has put forth a framework that is underpinned by overarching regulations and compulsory rulebooks, segregating activities-based rulebooks to rapidly account for novel products, emerging technologies, and new business models that require regulatory capture.

The paper’s findings reinforce the urgent need for policymakers and regulators to collaborate with industry and users to realize the benefits while addressing the risks involved.

Enforcement is still weak globally. For example in the context of AML supervision of crypto-assets, a Bank for International Settlements (BIS) 2021 survey found that oversight remained nascent globally. As stated, “Although many are at different stages, with some countries still finalizing applicable law and policy and a small portion engaging in active supervision, by and large effective enforcement measures remain a work in progress. The result is a complex tapestry of enforcement trends as well as enforcement risks posed by the cross-jurisdictional influence of crypto-assets.”

Even when it comes to the FATF travel rule implementations are also limited. As noted in FATF’s June 2022 targeted update report, interoperability across technical solutions and across jurisdictions is still lacking.

WEF report as such notes that such fragmented enforcement techniques will pose a challenge to the supervision and monitoring of crypto-assets against regulations in the short term and may take many years to standardize.

The report recommends promoting a harmonized understanding of taxonomy/classification of crypto assets and activities, set out best practices and baseline regulatory standards for achieving the desired regulatory outcomes and encourage passportability of entities and data sharing.

Building on this foundational paper, the World Economic Forum’s Blockchain and Digital Assets team will launch an initiative focused on evaluating the outcomes of different regional approaches to regulation. This effort will convene public- and private-sector leaders to reveal first-hand learning’s and the unintended consequences.

But not everyone shares the WEF reports belief that International crypto regulations and standards are possible.  During the Qatar Economic Forum this week, Peter Smith Co-Founder and CEO of Blockchain.com rejected claims of a “United Nations” of crypto as inconceivable. He stated, “A global system to regulate cryptocurrency is unlikely to exist.”

However, the Blockchain chief recalled the recent EU passing of the world’s first comprehensive package as a step forward in cautiously regulating the cryptocurrency industry. In addition, Smith told Bloomberg that regulators that express optimistic calls to crypto would promote development for the industry.

So whether a global harmonic set of crypto assets regulations are formulated or whether regional and national countries work to build their own, the growth of crypto assets cannot be curved by regulators. 

Japanese Nomura Bank’s digital asset custodian Komainu receives MVP operational license from Dubai regulator

Japanese Nomura Bank’s digital asset custodian Komainu receives MVP operational license from Dubai regulator

Japanese Nomura Bank’s, Komainu, a regulated digital asset custody provider, has received an MVP (Minimum Viable Product) operational license from Dubai’s Virtual Asset Regulatory Authority (VARA). This is one step from receiving the full operational license. This also follows HexTrust another digital asset custodian who received the license prior. Under the license Komainu will be able to offer both custodial and staking services.

Komainu had received provisional regulatory approval from VARA in July 2022 allowing it to commence operational readiness even as the application goes through the warranted due diligence.

Komainu acts as key gatekeeper to institutions gaining exposure to the digital asset industry with the provision of secure and regulated digital asset custody services for blockchain and beyond. Over the years, Komainu has established itself as one of the leading digital asset custody providers for institutional clients, providing the same safeguards and protections investors are accustomed to in traditional finance. 

Komainu is the first hybrid custodian for institutional digital asset investors created by the Japanese investment bank Nomura, digital asset manager CoinShares and digital asset security company Ledger.

Universal Digital and Canadian Aquanow receive several MVP licenses from Dubai’s virtual asset regulator

Universal Digital and Canadian Aquanow receive several MVP licenses from Dubai’s virtual asset regulator

Universal Digital AEDU and Canadian Aquanow have received MVP ( Minimum Viable Product) provisional license approvals for several virtual asset licenses from Dubai’s Virtual asset regulatory authority (VARA). Universal Digital (AEDU) has applied for advisory license, broker dealer services, virtual asset custodial license, crypto exchange license, crypto lending and borrowing license, as well as management and investment service license.

In addition Canadian headquartered, digital asset platform has also received MVP provisional approval for advisory license, broker dealer license, and management investment service license.

Aquanow is a privately funded, infrastructure and liquidity provider that enables institutional and enterprise use-cases for digital assets. The company currently has 200 institutional clients, serving customers in 30 plus countries with 70 asset pairings.

This is another representation of increased interest in the UAE as a center for virtual assets, blockchain and crypto. 

UAE based Enjinstarter is supporting the Next Sustainable and climate friendly Metaverse Experience

UAE based Enjinstarter is supporting the Next Sustainable and climate friendly Metaverse Experience

The engine that will ignite a sustainable future starts with Web3, its associated technologies, and UAE based Enjinstarter. Enjinstarter, launched in 2021 is a Launchpad, incubator, crowd funding, and advisory platform for Web3 metaverse, gaming, entertainment and impact and sustainable projects.

At the beginning of 2023, Enjinstarter appointed Vasseh Ahmed as the new Managing Director to lead the Web3 efforts in the MENA region. Vasseh spoke with LaraontheBlock to discuss Enjinstarter’s plans to help companies reach their Web3 ambitions while positioning Enjinstarter as the go to provider for impact and sustainability projects.

Ahmed, speaking with Lara on the Block, stated, “Before I joined Enjinstarter I was working in the UAE for four years on a digital bank project. I had been in the blockchain and crypto space for over 6 years, so when I met Prakash Somosundram, [Enjinstarter’s] CEO and Co-Founder, and we discussed the launch of an impact and sustainability track, I was all in.”

Enjinstarter in MENA

According to Ahmed, “We have supported 70 projects since inception, helping them raise a total of $10 million. Since the middle of 2022 we have focused on investing in founders who can demonstrate clear utility in their projects. This has worked really well so far, and we continue to onboard more projects each month.”

As for the MENA region, Ahmed believes that UAE has its allure not just because of the investments and capital being deployed in Web3, but also because of its very good regulatory environment and its strategy to build an innovative infrastructure. He explains, “The UAE has become a hotbed for Web3 projects. We are seeing an increasing number of start-ups and companies moving to the region. Enjinstarter is one of them, and we are the first Launchpad globally to apply for the appropriate license in Dubai. We have already received initial approval from Dubai’s Virtual Asset Regulatory Authority (VARA) and are now in the process of obtaining a full license to operate.”

He explains, “We appreciate VARA’s progressive approach to regulation. It has been instrumental in helping us at every step of the licensing process. We have a few more steps to complete in order to obtain the full license, then we can begin operations. Singapore has not shown the same commitment to virtual asset regulation, whichis one of the reasons we chose to expand to MENA and run Enjinstarter in a regulated manner.”

Enjinstarter and a Sustainable Future

The climate emergency is becoming a pressing issue. Temperatures are expected to rise 1.5 degrees Celsius by 2050 which will raise sea levels and lead to huge climate changes and extinctions of many animals, and plants.

Yet to date nothing has seemed to incentivize people to do something about it even with the creation of carbon credits. The challenge with carbon credits is that they are only available to corporations and governments. Individuals don’t have much access other than through carbon offset schemes.

For this reason, Enjinstarter is looking to add more projects that focus on impact and sustainability replicating the success of their existing launchpad while complementing it with UAE’s outlook towards building a sustainable future.

Ahmed states, “Web3 has a major role to play in addressing the climate crisis. Carbon credits, in particular, can benefit from Web3’s underlying technology to increase transparency and accessibility. We want to support projects that are looking for ways to shift incentives away from exploitation and toward preservation and regeneration.”

He adds, “Corporate demand for emission reduction strategies is clear. Microsoft, for example, has taken the lead in offsetting its carbon footprint by buying carbon credits. The UAE government has also signalled its desire to be the first carbon-neutral country in MENA. What we need are more initiatives looking to fulfill this demand. Our climate launchpad is designed to scale these initiatives and, ultimately, climate impact.”

Enjinstarter is already working with large scale projects that will be announced in due time, but also wants to focus on grassroots projects. Ahmed explains, “Major projects aren’t the only way to effectively combat climate change. If there is a project making demonstrable climate impact, we want to incubate, accelerate, and match them with interested investors.” 

Ahmed also believes AI (Artificial Intelligence) will be part of Web3 climate solutions. He explains, “As a scuba diver I have seen firsthand how ocean species are either extinct or very close to extinction. Putting these species in the metaverse and allowing users to interact with them can help us build awareness around the importance of preserving them. We can work directly with marine conservations to build the kind of metaverse experiences that maximize engagement with people. Today’s youth, for example, already spend a lot of time gaming. Why not give them the opportunity to play for a good cause?”

Web3 is changing Business models

Enjinstarter has been working with corporations to help them transition seamlessly from their Web2 past  to a Web3 future. Web3 is changing business models and inevitable outcome of digitization and the metaverse sits at the center of it all.

The company is a strong partner with Web3 giant Animoca Brands, the holding company of The Sandbox metaverse. Enjinstarter and Animoca not only have in common their belief in the metaverse but they also have common investors. True Global Ventures 4 Plus has invested both entities. Enjinstarter raised US$5 million in their Series-A round from True Global Ventures 4 Plus.

According to Ahmed, ”True Global Ventures is a very hands-on VC and we love having them as our only VC investor so far. They were instrumental in developing our UAE expansion strategy.”

Both Enjinstarter and Animoca Brands believe that the future of the metaverse hinges on interoperability. The two partnered together for OMA3™, a collaboration of Web3 metaverse platform creators whose goal is to ensure virtual land, digital assets, ideas, and services are highly interoperable between platforms and transparent to all communities. OMA3™ is open to all Web3 metaverse builders.

With this in mind Enjinstarter has developed its Web3 Innovation consulting practice that works with brands, large corporations, and Web2 companies to help them develop Web3 strategies.

Ahmed explains, “In the UAE and GCC there is a lot of excitement towards and experimentation with Web3.. Part of our mission is to help clients jump into Web3 and the metaverse. We’ve developed a playbook for success comprising 30 core skills and actvities. The most important is to take a community-first approach, meaning that you build your community first, then your product. ”

Utilizing a holistic multi-disciplinary approach and a portfolio of partners, Enjinstarter has been able to help replicate its successes with previous projects and build loyalty based metaverse experiences, NFTs, and more.

This is just the beginning; Ahmed believes that there is a lot happening in the region on a government and corporate level and that the future will see AI and Web3 come together as the masses adopt Web3 and metaverse experiences.

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.”

Crypto exchange MaskEX to set up headquarters in UAE after receiving initial approval from UAE regulator

Crypto exchange MaskEX to set up headquarters in UAE after receiving initial approval from UAE regulator

Crypto exchange, MaskEX has unilaterally announced receiving an initial approval from Dubai’s Virtual Asset Regulatory Authority (VARA) to begin making preparations for its launch in the United Arab Emirates (UAE). It also will be opening its headquarters in Dubai and hiring. 

As per the announcement, the approval represents a major milestone for MaskEX, which has been working tirelessly to expand its presence in the Middle East and bring the benefits of virtual assets to a wider audience.

MaskEX will begin finalizing its entity incorporation, engage banking services, hire more staff in Dubai for its soon-to-be-opened headquarters office, and take the necessary steps to become the first regulated exchange in the UAE.

The services and activities MaskEX has applied for include exchange, lending and borrowing, broker-dealer, and virtual asset management and investment services, with the aim of obtaining VARA’s highly acclaimed FMP license. This license will enable MaskEX to operate in and from Dubai while upholding its commitment to regulatory compliance, customer protection, and innovation. 

“We are extremely proud and grateful to have received initial approval from VARA, which is a testament to our commitment to meeting the highest regulatory standards,” said Eric Yang, CEO of MaskEX. “We believe that our platform will provide users in the UAE with a safe, reliable, and efficient way to access the world of virtual assets, and we look forward to launching as soon as possible, while strictly adhering to the requirements laid out by VARA.”

“The initial approval from VARA is a major milestone for us, and is of great significance not just for the UAE but for the entire MENA region,” said Ben Caselin, Vice President and Chief Strategy Officer of MaskEX. “We look forward to working closely with the regulatory authorities to ensure that our platform meets all necessary requirements and provides a secure and transparent environment for our users.”

UAE EnjinStarter first Web3 Launchpad globally to be initially licensed by regulator

UAE EnjinStarter first Web3 Launchpad globally to be initially licensed by regulator

UAE based EnjinStarter MENA, a web3 Launchpad and incubator, has become the first launchpad globally to receive initial approval by Dubai’s virtual asset regulatory authority.

According to the unilateral announcement, EnjinStarter will continue to undertake the in-depth process of applying for a licence, in accordance with VARA requirements.

With the Middle East and North Africa considered to be a booming Web3 market, Enjinstarter is seeking a foothold in the region as it aims to be the premier Launchpad and incubator for Web3 metaverse, gaming, and entertainment experiences.

Enjinstarter has ambitious plans to be the go-to provider for Web3 adoption in the region, including the addition of more portfolio projects focusing on impact and sustainability initiatives that complement the UAE’s commitment to climate action.

“This is an important step for Enjinstarter. Getting initial approval and continuing with our license application makes clear our commitment to achieving the highest standards of accountability and transparency in the Web3 space. We are committed to   conforming to VARA’s high standards and know this will only accelerate our growth in the Middle East and beyond,” said Prakash Somosundram, co-founder and CEO of Enjinstarter.

“Dubai has been laser-focused on establishing itself as a global hub for Web3. It continues to provide much-needed leadership in terms of regulation and innovation, especially with initiatives such as VARA’s own foray into The Sandbox. We are looking forward to getting started here and contributing to Dubai’s growing Web3 ecosystem,” added Vasseh Ahmed, Enjinstarter MENA’s managing director.

Digital asset exchange Fasset receives initial approval for full market license from Dubai’s VARA

Digital asset exchange Fasset receives initial approval for full market license from Dubai’s VARA

Unilaterally, Fasset, a digital asset exchange platform with a vision to offer affordable and frictionless gateway for people in emerging markets to own and grow their wealth in digital assets has announced  that it has been granted an Initial Approval for a Full Market Product (FMP) license by the Dubai’s Virtual Assets Regulatory Authority (VARA) in UAE.

As per the announcement, “Though the initial approval does not yet allow any virtual asset activity in or from Dubai, this initial stage indicates progress in obtaining full permission to operate in Dubai. This crucial step forward allows Fasset to lead the digital assets market, as one of the first exchanges to provide regulatory protection to consumers in Dubai, as the MENA region has been identified as the world’s fastest growing cryptocurrency market.”

Raafi Hossain, CEO and Co-Founder of Fasset stated, “This is an incredibly exciting time to be leading the way in democratizing access to digital assets. As the world turns to Dubai as the financial epicenter for growth, the opportunity to work with VARA embeds improved access to digital assets with the provision of heavily anticipated regulatory guardrails. We are grateful for the leadership and guidance of VARA team in helping us achieve the milestone of being one of the first exchanges to receive Initial Approval under the FMP license, and look forward to working with the VARA team to achieve full permission to offer our services to the world from Dubai.”

Fasset has sought regulatory permissions across the biggest markets in the Middle East, Asia and Africa, where digital asset-based rails are vital.

Currently Fasset is participating as a sponsor and speaker at the Dubai Fintech Summit. Mohammad Raafi Hossain, participated in a panel discussion on Crypto and the evolving regulatory framework emphasizing the societal value of crypto.

Raafi emphasized that regulation should serve as a positive reinforcement tool for the main benefits of wealth creation and property rights ownership, rather than a reactive response to the negative aspects of the crypto industry. Secondly, he highlighted the need for an international philosophy and ethos around crypto regulation that takes into account the desires and needs of the market with regards to asset ownership and enablement.

Fasset has also signed two MOUs, one with Minted which will provide increased access to tokenized precious metals across developing markets including Turkey, Indonesia and UAE and another one with Oman Mamun which will focus on building innovative new solutions for Oman based on real world assets. The collaboration with Mamun will increase access to investment opportunities and enhance liquidity for physical assets, all within a secure and compliant framework.

CoinBase, Circle, and Bittrex leaving USA and heading to the MENA region

CoinBase, Circle, and Bittrex leaving USA and heading to the MENA region

The exodus of Crypto and Blockchain startups from the United States seems to be intensifying and it looks like the MENA region, and UAE are the new preferred destinations for CoinBase, Circle and Bittrex. 

Tim Draper, Founder of DFJ VC tweeted recently that Silicon Valley startups are relocating to Middle East, Asia, and Europe.

He states, “CoinBase and Gemini are moving out of the US for regulatory reasons. Dubai, London and Singapore are eating into New York’s blockchain leadership. This exodus is not good for US jobs, economy, and homelessness.”

Additionally, in the last 24 hours CoinBase announced that its CEO and Co-Founder Brian Armstrong is currently in the UAE for a series of engagements with policymakers, regulators, partners, Web3 and crypto founders as well as clients.

Armstrong is delivering a keynote address at the inaugural Dubai Fintech Summit, under the patronage of His Royal Highness, Sheikh Maktoum bin Mohammed bin Rashid Al Maktoum, First Deputy Ruler of Dubai, Deputy Prime Minister and Minister of Finance.

As per CoinBase blog, “Crypto and Web3 serve as enormous opportunities for economic and technological diversification for the UAE, and the region has the potential to be a strategic hub for CoinBase, amplifying our efforts across the world.”

The blog adds, “It further serves as a particularly strategic bridge between Asia and Europe – two of our existing focus international regions to date.”

CoinBase reiterated that it is not only working with Abu Dhabi Global Market (ADGM) regulators to further expand the licensing and availability for CoinBase International Exchange but is also engaging with Dubai’s Virtual Assets Regulatory Authority (VARA), a dedicated regulator for virtual assets, as they put forward a comprehensive retail framework built on the principles of economic sustainability and cross-border financial security. 

CoinBase believes that their presence in the UAE will not only expand their global footprint but also help to bring 1 billion users to crypto.  

The blog adds that the MENA region is out to be a leader in the development of a web3 ecosystem, making it an attractive location to consider investing in. The vacuum created by other notable jurisdictions means that international counterparts, such as the UAE, are racing to fill the regulatory gap.

CoinBase is not the only US Company that is looking at the UAE. It also seems Circle is interested in the region as well. The Circle team were recently present in Dubai UAE at a dinner hosted by Miriam Kiwan, the partner of Raiven Capital.

Jeremy Allaire, CEO of Circle Internet Financial, during an interview with Bloomberg, blamed the shrunken value of the company’s stablecoin, USD Coin, on regulatory challenges in the United States and concerns about its banking system.

In addition in March 2023 the SEC sued crypto exchange Bittrex shortly after it announced it was leaving the US markets. Bittrex, announced it would no longer do business with U.S. citizens because “it’s just not economically viable for us to continue to operate in the current U.S. regulatory and economic environment.”

Stephen Stonberg, CEO of Bittrex Global crypto exchange  has stated that the UAE and Dubai are among the friendliest jurisdictions for the cryptocurrency industry. He added in a Bloomberg interview Dubai is likely to benefit from the expanding crypto market in the Middle East as local regulators increasingly accept blockchain related technologies.

Finally in a recent LinkedIn post by Ali Jamal, CEO of UAE based Cryptos Consultancy, a crypto and Blockchain licensing firm, he noted, “We at Cryptos Consultancy have been getting lots of queries from crypto and tradfi businesses about setting up Virtual Asset practices in Dubai. There is a real buzz around Dubai’s virtual assets ecosystem now that the Virtual Assets Regulatory Authority (VARA) regulations are out.”

So as crypto and Blockchain businesses flee the USA, the tightening regulations in the USA continue with The New York State Attorney General (NYAG) Office announcing last week that Attorney General Letitia James has proposed “landmark legislation to tighten regulations on the cryptocurrency industry to protect investors, consumers, and the broader economy.” The announcement stated, ” Attorney General James’ program bill, which proposes the strongest and most comprehensive set of regulations on cryptocurrency in the nation, would increase transparency, eliminate conflicts of interest, and impose commonsense measures to protect investors, consistent with regulations imposed on other financial services.” 

It seems that this is only the beginning and the MENA region with UAE and Bahrain at the helm will become the new crypto Silicon Valley. 

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