The United Arab Emirates (UAE) plan to issue the first national licenses for virtual asset service providers (VASPs) by the end of Q1 2022, according to a government official cited by Bloomberg.
According to a source cited by the publication, the UAE’s Securities and Commodities Authority (SCA) is in the final stages of enacting amendments to permit the creation of VASPs. The regulator believes the move will attract some of the largest crypto companies to the local market.
Documents obtained by journalists show that several special economic zones have already granted licenses to VASPs. Specifically, 22 companies in Dubai Multi Commodities Centre, six firms in Abu Dhabi Global Market and at least one in Dubai Silicon Oasis.
In an interview with Bloomberg, an official said that the UAE is pursuing a hybrid approach to supervision. The SCA and the central bank will regulate the market at the national level, while local financial centres will be able to establish their own licensing procedures. He stressed that in drafting the bill the latest FATF guidance was taken into account.
The official also said that the UAE government plans to create a ‘cryptocurrency mining ecosystem’ in the country. He said the sector would be regulated at the national level.
Earlier in December 2021, the Binance bitcoin exchange signed a memorandum of understanding with the Dubai World Trade Centre Authority to create an industry hub in the emirate.
Read ForkLog’s bitcoin news on our Telegram — cryptocurrency news, prices and analytics.