Crypto companies looking to offer services in the United Arab Emirates can now apply for a license with the country’s securities regulator, according to an announcement released on Monday.
The UAE’s Securities and Commodities Authority (SCA) said that it has officially begun accepting applications by virtual asset service providers (VASPs), which is now required by law. The move comes shortly after the country decided to regulate the crypto industry at the end of 2022. The SCA absorbed regulatory responsibilities for crypto on February 1.
The announcement states that all companies, except those already licensed in financial free zones, must submit an application to apply for a license from the SCA — but all companies operating in Dubai must obtain a license from the city’s regulatory authority (VARA) in addition to seeking SCA approval.
Crypto firms like Binance are eyeing the country as the next hub for their operations. Binance chief Changpeng Zhao (CZ) reportedly lives in Dubai, wherein he hopes to establish Binance following scrutiny in the US, Australia, and elsewhere.
However, the UAE’s decision to regulate the industry has already impacted these hopes — at the start of April, Dubai requested more information from Binance into ownership structure as well as governance and auditing procedures, regarding its application.
According to the SCA, any cryptocurrencies traded in the country must be first accepted into its official list of tradeable assets.
UAE-based blockchain lawyer Irina Heaver, who spoke to Cointelegraph in January, said companies who choose to operate illegally in the country could face fines of up to 10 million AED ($2.7 million) as well as criminal charges.