Katherine Ross

Abu Dhabi’s Financial Services Regulatory Authority granted Rain a Financial Services Permission on Tuesday.



The Bahrain-based crypto company is the first to receive a license to operate as a “regulated brokerage and storage services,” for some retail investors as well as institutions, according to a tweet from the company.



Rain added via Twitter thread, “This permit allows us to usher in a new era for the adoption of virtual assets in the region, as the company will be able, through this permit, to provide services for the purchase, sale and storage of virtual assets to customers, including institutions and a number of individual customers in the United Arab Emirates.”



<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="550" data-dnt="true">يتيح هذا التصريح الدخول في حقبة جديدة لتبني الاصول الافتراضية في المنطقة، حيث ستتمكن الشركة من خلال هذا التصريح تقديم خدمات شراء الأصول الافتراضية وبيعها وتخزينها للعملاء ومنهم  المؤسسات وعدد من العملاء الافراد في الإمارات العربية المتحدة.&mdash; Rain (@rain) <a href="https://twitter.com/rain/status/1683821225204649985?ref_src=twsrc%5Etfw">July 25, 2023</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></figure>



CEO Joseph Dellago added some clarity to what this license means for Rain customers. Dellago said “residents will now be able to fund their accounts in minutes” and alluded to a ”partnership with a local UAE bank.”



<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="550" data-dnt="true">What does this mean for customers? UAE residents will now be able to fund their accounts in minutes, thanks to a partnership with a local UAE bank. Furthermore, customers are further protected through the supervision of a local regulator and thorough legal framework.&mdash; Joseph Dallago (@_jayd3e) <a href="https://twitter.com/_jayd3e/status/1683774864249745409?ref_src=twsrc%5Etfw">July 25, 2023</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></figure>



Rain did not immediately respond to a request for comment.



Yehia Badawy, Rain’s cofounder, said that Rain initially met with regulators in 2018.



<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="550" data-dnt="true">منذ خمس سنوات، قابلنا سلطة تنظيم الخدمات المالية في سوق ابو ظبي العالمي. يسعدنا اليوم الإعلان عن حصول <a href="https://twitter.com/rain?ref_src=twsrc%5Etfw">@rain</a> علي تصريح الخدمات المالية&mdash; Yehia | يحي (@YehiaBadawy) <a href="https://twitter.com/YehiaBadawy/status/1683818981700907009?ref_src=twsrc%5Etfw">July 25, 2023</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></figure>



Abu Dhabi Global Market rolled out a crypto framework back in 2018. At the time, the ADGM said the regulatory framework showed its “ongoing commitment to bolster the economic diversification of Abu Dhabi through innovation and sustainable initiatives.”



In 2021, ADGM’s Shorafa Al Hammadi told Blookworks, “<a href="https://blockworks.co/news/abu-dhabi-ramps-up-effort-to-become-middle-easts-crypto-hub">The whole ecosystem in Abu Dhabi</a> [&#8230;] is working together to make it easy for all the actors of that space, to not only attract them but bring them here, to develop the legal framework.”



<a href="https://blockworks.co/news/kraken-receives-abu-dhabis-first-virtual-asset-exchange-license">Kraken initially sought and received a license</a> in Abu Dhabi in 2022, but the exchange shuttered its office there in February of this year.



<hr class="wp-block-separator has-alpha-channel-opacity"/>



Get the news in your inbox. Explore Blockworks newsletters:



<ul class="wp-block-list">
<li><a href="https://blockworks.co/newsletter/the-breakdown">The Breakdown</a>: Decoding crypto and the markets. Daily.</li>



<li><a href="https://blockworks.co/newsletter/0xresearch">0xResearch</a>: Alpha in your inbox. Think like an analyst. </li>
</ul>

Abu Dhabi

Abu Dhabi grants Rain permit for virtual assets brokerage, custody services

Ornella Hernandez

<div id="highlights-block_63372b3a23583" class="highlights">
 <ul>
 <li>UAE aims to measure sectors of tourism, education, retail, real estate and government</li>
 <li>While most metaverse projects have taken place in the private sector, the UAE wants to determine how a government can leverage the potential of the metaverse</li>
 </ul>
 
</div>



The UAE is taking a bold crypto twist when it comes to the global standard for measuring a country’s economy, traditionally denominated in gross domestic product (GDP).



The nation&#8217;s latest initiative: employing the new metric of gross metaverse product (GMP) — the move, while perhaps gimmicky, has been closely watched by digital assets players as the latest indicator of a major government taking the asset class seriously. It remains to be seen whether the nascent standard will have much sticking power.



Omar bin Sultan Al Olama, minister of state for artificial intelligence, digital economy and remote work applications, laid out the decision to go all in on crypto and Web3 during the Dubai Metaverse Assembly on Wednesday.



The end goal for the UAE is to prove the metaverse, eventually, could carry enough of a market capitalization that it would rival some of the world’s largest economies.



&#8220;Gross metaverse product will be able to create billions of dollars in returns for Dubai without people being physically in the emirate but experiencing it in the metaverse,&#8221; Al Olama <a href="https://www.thenationalnews.com/business/technology/2022/09/28/dubai-plans-to-start-new-economic-metric-called-gross-metaverse-product/" target="_blank" rel="noreferrer noopener">said</a> at the Museum of the Future in Dubai.



While most metaverse projects have taken place in the private sector, the UAE wants to determine how a government can leverage the potential of the metaverse on its own accord. It would also allow the UAE to set its own regulatory rules that would not necessarily apply to related, privately-funded projects.&nbsp;



The US has the world’s largest GDP, with $23 trillion on a nominal basis, and China has the second largest with $17 trillion.



However, the UAE’s economy grew by an estimated 8.2% in the first quarter of 2022, and real GDP is expected to grow 5.4% this year, <a href="https://www.nasdaq.com/articles/uae-economy-grew-8.2-in-q1-central-bank-estimates" target="_blank" rel="noreferrer noopener">according</a> to the central bank.



The nation state’s Prime Minister and Ruler of Dubai Sheikh Mohammed bin Rashid Al Maktoum attributed 2022’s rapid economic growth to foreign trade, higher oil prices and tourism. He cited a 42% <a href="https://twitter.com/HHShkMohd/status/1568873124829036544?s=20&amp;t=cO-yX83E3hlXSG7EwZzDUA" target="_blank" rel="noreferrer noopener">increase</a> in the number of hotel guests so far this year via Twitter on Sept. 11.



When it comes to the UAE’s metaverse strategy, the main sectors to be measured are tourism, education, government services, retail and real estate.



And a task force will be launched to bolster tourism, according to the minister. The UAE Ministry of Economy will also establish a virtual “office” with an auditorium to hold meetings and sign contracts in the metaverse.&nbsp;



Other UAE Web3 initiatives include <a href="https://cms.blockworks.co/crypto-com-secures-provisional-approval-to-open-crypto-exchange-in-dubai/" target="_blank" rel="noreferrer noopener">granting operation licenses</a> to exchanges Binance and Crypto.com, <a href="https://cms.blockworks.co/unstoppable-domains-gifted-blockchain-domain-names-to-1m-women-in-abu-dhabi/" target="_blank" rel="noreferrer noopener">partnering with Unstoppable Domains</a> to gift domains to women in Abu Dhabi and <a href="https://cms.blockworks.co/emirates-airline-to-accept-bitcoin-payments-and-launch-nft-collection/" target="_blank" rel="noreferrer noopener">adding bitcoin as a payment option for Emirates Airline</a>. 



The UAE is serious about creating a GMP and may now have to prove that the market capitalization of metaverse initiatives can be measured and tracked. Perhaps NFT sales may contribute to this new metric.



Samuel Huber, CEO of metaverse company LandVault, appears to be optimistic and “excited” about the news according to a LinkedIn post.



“As we increasingly live online, and boundaries with the physical world are blurring,” the UAE understands that the metaverse may be a growth lever, <a href="https://www.linkedin.com/posts/samhuber_probably-nothing-the-uae-announces-a-activity-6981108266567094272-pqCk?utm_source=share&amp;utm_medium=member_desktop" target="_blank" rel="noreferrer noopener">he said</a>.



<hr class="wp-block-separator has-alpha-channel-opacity"/>



Get the news in your inbox. Explore Blockworks newsletters:



<ul class="wp-block-list">
<li><a href="https://blockworks.co/newsletter/the-breakdown">The Breakdown</a>: Decoding crypto and the markets. Daily.</li>



<li><a href="https://blockworks.co/newsletter/0xresearch">0xResearch</a>: Alpha in your inbox. Think like an analyst. </li>
</ul>

Dubai

Can ‘Gross Metaverse Product’ Replace GDP Metric? Dubai Thinks So

Ben Strack

<div id="highlights-block_62e06d78a26e4" class="highlights">
 <ul>
 <li>Komainu seeks to launch institutional-focused yield product and other services in Dubai</li>
 <li>The company is aiming for at least 10 employees in the emirate by the end of the year</li>
 </ul>
 
</div>



Crypto custodian Komainu has gained provisional regulatory approval to operate in Dubai, becoming the latest blockchain firm to begin setting up shop in the region.



Founded in 2018, Komainu was created by Japanese investment bank Nomura, European digital asset manager CoinShares and French hardware wallet maker Ledger. 



Komainu, which is headquartered in the Channel Islands, now seeks to employ at least 10 staff in its new Dubai outpost by the end of the year.



“Komainu is looking to provide custody and yield services to local exchanges and fund managers as well as help new market participants enter the digital asset industry in the region,” Sebastian Widmann, Komainu’s head of strategy, told Blockworks in an email.&nbsp;&nbsp;



The initial approval came from Dubai’s Virtual Assets Regulatory Authority (VARA), which was <a href="https://cms.blockworks.co/dubai-is-the-latest-government-to-roll-out-crypto-law-set-up-regulator/" target="_blank" rel="noreferrer noopener">established in March</a>. The company will work with the regulator to apply for a full license, Widmann said, but did not comment on a timeline for that approval.&nbsp;



Dubai and VARA are creating a regulatory framework to inspire a local hub for digital asset businesses, according to the executive.



“Komainu actively works with regulators, partners and our clients to make sure that our platform is held to the highest of standards, and this latest endorsement by the Dubai Government is a further testament to that fact,” Widmann said in a statement. “By expanding into the [Middle East and North Africa] region, we are bringing a much-needed service to institutions operating within a regulated crypto marketplace.”



The company will seek to launch <a href="https://www.komainu.com/komainu-adds-yield-generating-platform-to-custody-solutions/" target="_blank" rel="noreferrer noopener">Komainu Yield</a> — allowing institutions to earn yield on assets custodied with the company — and other new services in the emirate, the executive told Blockworks.



Komainu’s move to the emirate is not unique, as Dubai granted virtual asset licenses to <a href="https://cms.blockworks.co/ftx-granted-crypto-license-with-dubai-hq-in-sights/" target="_blank" rel="noreferrer noopener">FTX</a> and <a href="https://cms.blockworks.co/binance-granted-license-to-operate-in-dubai/" target="_blank" rel="noreferrer noopener">Binance</a> in March. <a href="https://cms.blockworks.co/crypto-com-secures-provisional-approval-to-open-crypto-exchange-in-dubai/" target="_blank" rel="noreferrer noopener">Crypto.com</a> and Hong Kong-based crypto custodian <a href="https://cms.blockworks.co/hex-trust-greenlit-for-virtual-asset-license-in-dubai/" target="_blank" rel="noreferrer noopener">Hex Trust</a> gained regulatory approval to conduct business in the region in June. More recently, <a href="https://cms.blockworks.co/okx-to-expand-in-uae-after-dubai-regulatory-approval/" target="_blank" rel="noreferrer noopener">OKX revealed plans</a> earlier this month to build its presence in Dubai.



<hr class="wp-block-separator has-alpha-channel-opacity"/>



Get the news in your inbox. Explore Blockworks newsletters:



<ul class="wp-block-list">
<li><a href="https://blockworks.co/newsletter/the-breakdown">The Breakdown</a>: Decoding crypto and the markets. Daily.</li>



<li><a href="https://blockworks.co/newsletter/0xresearch">0xResearch</a>: Alpha in your inbox. Think like an analyst. </li>
</ul>

Crypto Custodian Komainu Follows Exchanges to Dubai

<div id="highlights-block_62cf41a0e83d6" class="highlights">
 <ul>
 <li>OKX plans to recruit more than 100 employees in the region</li>
 <li>Others expanding to the UAE this year include competitors FTX, Binance, Kraken and Crypto.com</li>
 </ul>
 
</div>



OKX is the latest crypto exchange with plans to build out a foothold in Dubai after gaining regulatory approval to serve customers in the United Arab Emirates.



The Dubai Virtual Assets Regulatory Authority (VARA) granted OKX a provisional virtual assets license, the company revealed Thursday, allowing it to offer certain exchange products and services to pre-qualified investors and financial service providers in the region.



“Dubai and UAE leadership have embraced blockchain technologies and continue to invest heavily in the crypto ecosystem,” Lennix Lai, general manager OKX Dubai, told Blockworks in an email. “For OKX, it&#8217;s a natural partner jurisdiction and a long-term play, where we can attract high-quality talent and serve an engaged international crypto audience.&#8221;



Dubai <a href="https://cms.blockworks.co/dubai-is-the-latest-government-to-roll-out-crypto-law-set-up-regulator/" target="_blank" rel="noreferrer noopener">revealed its first cryptocurrency legislation</a> in March, as the emirate granted virtual asset licenses to <a href="https://cms.blockworks.co/ftx-granted-crypto-license-with-dubai-hq-in-sights/" target="_blank" rel="noreferrer noopener">FTX</a> and <a href="https://cms.blockworks.co/binance-granted-license-to-operate-in-dubai/" target="_blank" rel="noreferrer noopener">Binance</a> that month.&nbsp;



More recently, <a href="https://cms.blockworks.co/crypto-com-secures-provisional-approval-to-open-crypto-exchange-in-dubai/" target="_blank" rel="noreferrer noopener">Crypto.com</a> and Hong Kong-based crypto custodian <a href="https://cms.blockworks.co/hex-trust-greenlit-for-virtual-asset-license-in-dubai/" target="_blank" rel="noreferrer noopener">Hex Trust</a> gained regulatory approval to conduct business in the region in June.&nbsp;



Kraken also <a href="https://cms.blockworks.co/kraken-receives-abu-dhabis-first-virtual-asset-exchange-license/" target="_blank" rel="noreferrer noopener">revealed plans</a> to expand to the UAE in April, but, unlike some of its competitors, opted for neighboring emirate Abu Dhabi instead of Dubai.



“The UAE has a high concentration of crypto natives and sophisticated traders,” Lai said. “OKX [wants] to galvanize this constituency and support responsible trading behaviors.”



Founded in 2017, crypto trading app OKX has more than 20 million global customers in roughly 180 international markets. The company plans to recruit more than 100 employees in the UAE and seeks to partner with local players in the sector.



The expansion to a new region comes after OKX <a href="https://cms.blockworks.co/latest-in-crypto-hiring-okx-bitget-among-companies-boosting-headcount/" target="_blank" rel="noreferrer noopener">revealed last month</a> that it plans to increase headcount by 30%, growing by 1,500 people to about 5,000 over the next 12 months. The exchange is targeting professionals in product design, engineering and marketing as its main focus shifts to building a leading brand in the space.



<hr class="wp-block-separator has-alpha-channel-opacity"/>



Get the news in your inbox. Explore Blockworks newsletters:



<ul class="wp-block-list">
<li><a href="https://blockworks.co/newsletter/the-breakdown">The Breakdown</a>: Decoding crypto and the markets. Daily.</li>



<li><a href="https://blockworks.co/newsletter/0xresearch">0xResearch</a>: Alpha in your inbox. Think like an analyst. </li>
</ul>

OKX To Expand in UAE After Dubai Regulatory Approval

Shalini Nagarajan

Bessie Liu

<div id="highlights-block_62bcbc8b6d6e0" class="highlights">
 <ul>
 <li>“A favorable tax regime, supportive legislation, access to capital and a wealth of talent makes Dubai the Web3 hotspot of the future,” a crypto exec told Blockworks</li>
 <li>“India has battled brain drain for decades,” CoinSwitch’s CEO said</li>
 </ul>
 
</div>



India’s <a href="https://cms.blockworks.co/india-clarifies-crypto-taxes-as-trading-volumes-crater/" target="_blank" rel="noreferrer noopener">daunting cryptocurrency taxation</a> policies and seemingly complex treatment of digital assets are pushing local exchanges to Dubai and Singapore.



The nation recently announced a <a href="https://cms.blockworks.co/indias-crypto-tax-takes-effect-with-industry-fearing-it-will-stifle-growth/" target="_blank" rel="noreferrer noopener">1% tax deducted at source</a> (TDS) — meaning crypto users must pay 1% tax on any transaction — on top of a controversial <a href="https://cms.blockworks.co/indias-crypto-tax-takes-effect-with-industry-fearing-it-will-stifle-growth/" target="_blank" rel="noreferrer noopener">30% tax</a> on investment profits.



India’s 30% tax law, which came into effect on April 1, triggered trade volumes at four regional crypto exchanges — WazirX, ZebPay, CoinDCK and BitBns — to immediately <a href="https://www.coindesk.com/business/2022/04/11/crypto-trading-volumes-in-india-collapse-10-days-after-new-taxes-crebaco" target="_blank" rel="noreferrer noopener">crash</a> as much as 72%.



Moves like these have led to India’s central bank being labeled “hostile” to the cryptocurrency sector. Its governor Shaktikanta Das has <a href="https://www.moneycontrol.com/news/business/rbi-governor-interview-citing-crypto-crash-shaktikanta-das-says-rbi-has-been-rightly-cautioning-investors-8559491.html" target="_blank" rel="noreferrer noopener">cautioned against cryptocurrencies</a> and claimed they hold no underlying value.&nbsp;



Nischal Shetty and Siddharth Menon, co-founders of WazirX, have now reportedly shifted operations to Dubai, although they still plan on doing business out of Mumbai.&nbsp;



The Binance Labs-backed exchange told <a href="https://www.businesstoday.in/crypto/story/exclusive-wazirx-ceo-nischal-shetty-co-founder-siddharth-menon-shift-base-to-dubai-330395-2022-04-19" target="_blank" rel="noreferrer noopener">Business Today</a> it is a remote-first organization with employees in over 70 locations. Sameer Mhatre, the third co-founder, continues to head the exchange in India.



Coinbase Ventures-backed Vauld, which recently <a href="https://cms.blockworks.co/coinbase-backed-vauld-cuts-workforce-by-30-seeks-to-halve-exec-pay/" target="_blank" rel="noreferrer noopener">cut</a> its workforce by 30%, shifted its headquarters to Singapore in 2018 alongside ZebPay. CoinDCX is also registered there under the legal name Primestack Pte. Ltd.



“India has battled brain drain for decades. This is a generational opportunity to reset the odds in our favor,” said Ashish Singhal, co-founder and CEO of Bangalore-based CoinSwitch.



CoinSwitch itself isn’t being enticed to move operations away from the country. “We want to play an active role in shaping the Web3 ecosystem in India,” he said.



<blockquote class="wp-block-quote is-layout-flow wp-block-quote-is-layout-flow">“Examples from the US and other matured economies show institutional investors are ready to put capital in crypto markets if there is more regulatory clarity.”</blockquote>



While the new taxation in India appears restrictive and discouraging to investors, Dubai has a <a href="https://news.bitcoin.com/dubai-launching-crypto-valley-tax-free-zone/" target="_blank" rel="noreferrer noopener">full exemption</a> on cryptocurrency taxes — similar to its <a href="https://tradingeconomics.com/united-arab-emirates/personal-income-tax-rate#:~:text=The%20Personal%20Income%20Tax%20Rate,source%3A%20Ministry%20of%20Finance" target="_blank" rel="noreferrer noopener">treatment</a> of personal income.&nbsp;



The emirate’s crypto regulator, the Virtual Assets Regulatory Authority, began handing out crypto exchange licenses in March, and two months later Dubai announced its <a href="https://dlp.dubai.gov.ae/Legislation%20Reference/2022/Law%20No.%20(4)%20of%202022%20Regulating%20Virtual%20Assets.html" target="_blank" rel="noreferrer noopener">first law</a> regulating digital assets.



“There’s a unified regulator workflow, which synthesizes the regulations and creates a beacon for the UAE to become a leader in the digital asset space,” Pranav Sharma, founding partner of Woodstock Fund, told Blockworks. “Taxation rules are also on the individual side.”



<h3 class="wp-block-heading">Global companies look to Dubai and Singapore</h3>



It’s not just India’s crypto exchanges making the move. A raft of global companies are now preparing to launch in Dubai, including Binance, FTX Europe, Crypto.com and Bybit — even though Dubai-based crypto exchanges can only offer a limited number of products and services to pre-qualified investors and professional finance service providers throughout the first phase of its “test, adapt, and scale” framework.



“Dubai is set to become the largest blockchain hub globally,” Domenik Maier, CEO of Dubai-based crypto market maker iBLOXX, told Blockworks. “A favorable tax regime, supportive legislation, access to capital and a wealth of talent makes Dubai the Web3 hotspot of the future.”



<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="550" data-dnt="true">Today, we approved the virtual assets law and established the Dubai Virtual Assets Regulatory Authority. A step that establishes the UAE’s position in this sector. The Authority will cooperate with all related entities to ensure maximum transparency and security for investors. <a href="https://t.co/LuNtuIW8FM">pic.twitter.com/LuNtuIW8FM</a>&mdash; HH Sheikh Mohammed (@HHShkMohd) <a href="https://twitter.com/HHShkMohd/status/1501566703322513408?ref_src=twsrc%5Etfw">March 9, 2022</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></figure>



Singapore’s laws, too, are permissive for cryptocurrencies, where the purchase of digital assets isn’t considered taxable, and so capital gains <a href="https://cointelegraph.com/news/why-singapore-is-one-of-the-most-crypto-friendly-countries" target="_blank" rel="noreferrer noopener">aren’t taxable.</a>



Eric Barbier, founder and CEO of TripleA a company that allows businesses to pay and get paid in crypto says Singapore is “an efficient place to run a global business from.”



“I have been building companies in Singapore since the early 2000s because of its strong [intellectual property] laws, pro-business environment and international connectivity,” Barbier told Blockworks.&nbsp;



TripleA recently became one of the first crypto companies to be licensed by Singapore’s Central Bank, a process that took 18 months. Barbier believes that his company was able to receive regulatory approval as it ran by a business-to-business model, which made it “easier to enforce stringent regulatory and compliance standards.”&nbsp;



“Conducting a comprehensive verification process on a business is much easier than on a consumer or on an individual,” Barbier said.



Despite being headquartered in Singapore, Barbier says he has not completely ruled out the possibility of moving to Dubai.



“We are definitely not closing the doors to this possibility. At the moment, though, we are running a global business from Singapore and Europe,” he said. “It is imperative to have in place proper regulatory frameworks and good systems, which will ensure that we are not used as a vehicle for money laundering or terrorism financing in any way.”



<hr class="wp-block-separator has-alpha-channel-opacity"/>



Get the news in your inbox. Explore Blockworks newsletters:



<ul class="wp-block-list">
<li><a href="https://blockworks.co/newsletter/the-breakdown">The Breakdown</a>: Decoding crypto and the markets. Daily.</li>



<li><a href="https://blockworks.co/newsletter/0xresearch">0xResearch</a>: Alpha in your inbox. Think like an analyst. </li>
</ul>

Binance

India’s Tax Regime Prompts Crypto Companies To Leave

Sebastian Sinclair

<div id="highlights-block_62b124acabb52" class="highlights">
 <ul>
 <li>Dubai&#8217;s government is hoping to attract foreign investment following the passage of its Virtual Asset Law in February</li>
 <li>Hex Trust is the latest crypto firm to be approved, in part, for licensure within the emirate</li>
 </ul>
 
</div>



Hong Kong-based crypto custodian Hex Trust has become the latest crypto firm to receive provisional approval from the Government of Dubai to conduct business in the region.



Hex Trust said it is in the process of obtaining a Virtual Asset MVP License via the emirate&#8217;s Virtual Assets Regulatory Authority (VARA) to provide a range of services to institutional clients and investors, according to a statement Monday.



VARA, set up in March of this year, oversees virtual asset regulation via a licensing regime. The regulator is also responsible for developing strategic plans and policies relating to digital assets in the region, as well as establishing and overseeing know-your-customer checks and anti-money laundering rules.



It also became the world&#8217;s first regulator in May to establish a presence in the <a href="https://mediaoffice.ae/en/news/2022/May/03-05/Dubai-Virtual-Assets-Regulatory-Authority-becomes-world-first" target="_blank" rel="noreferrer noopener">metaverse</a> as a means of increasing accessibility to stakeholders.



With provisional approval now in hand, the custodian said it would open an office in Dubai for use as a regional headquarters in the Middle East. 



The move follows the custodian&#8217;s recent and first significant raise, an <a href="https://cms.blockworks.co/hex-trust-raises-88m-in-series-b-to-expand-into-europe-middle-east/" target="_blank" rel="noreferrer noopener">$88 million</a> Series B funding round in March, where funds were put toward scaling its operations in the Middle East and Europe.



Crypto firms continue to flock to the major Arab emirate following Dubai&#8217;s head, Sheikh Mohammed bin Rashid Al Maktoum, passing the &#8220;Regulation of Virtual Assets in the Emirate of Dubai&#8221; in February.



Better known as the Virtual Asset Law, the regulation sets about providing clear guidelines and definitions regarding digital assets, including NFTs (non-fungible tokens).



Several major crypto firms including <a href="https://cms.blockworks.co/ftx-granted-crypto-license-with-dubai-hq-in-sights/" target="_blank" rel="noreferrer noopener">FTX</a>, <a href="https://cms.blockworks.co/binance-granted-license-to-operate-in-dubai/" target="_blank" rel="noreferrer noopener">Binance</a>, <a href="https://cms.blockworks.co/crypto-com-secures-provisional-approval-to-open-crypto-exchange-in-dubai/" target="_blank" rel="noreferrer noopener">Crypto.com</a>, Bybit and <a href="https://cms.blockworks.co/kraken-receives-abu-dhabis-first-virtual-asset-exchange-license/" target="_blank" rel="noreferrer noopener">Kraken</a> have recently established regional headquarters or received licenses to operate in the United Arab Emirates.



&#8220;Hex Trust is excited and fully committed to expanding into the Middle East and sees enormous potential for digital asset growth given the progressive regulations, welcoming governments and thriving crypto ecosystem in the region,&#8221; Filippo Buzzi, Hex Trust&#8217;s regional director for the Middle East and North Africa, said in the statement.



<hr class="wp-block-separator has-alpha-channel-opacity"/>



Get the news in your inbox. Explore Blockworks newsletters:



<ul class="wp-block-list">
<li><a href="https://blockworks.co/newsletter/the-breakdown">The Breakdown</a>: Decoding crypto and the markets. Daily.</li>



<li><a href="https://blockworks.co/newsletter/0xresearch">0xResearch</a>: Alpha in your inbox. Think like an analyst. </li>
</ul>

Hex Trust Greenlit for Virtual Asset License in Dubai

<div id="highlights-block_627e8d88d2ee3" class="highlights">
 <ul>
 <li>Emirates is onboarding new staff to manage metaverse and NFT projects</li>
 <li>Emirates COO Adel Ahmed Al Redha revealed the news at the Arabian Travel Market</li>
 </ul>
 
</div>



Emirates, the largest airline in the United Arab Emirates, announced its intention to add bitcoin as a payment option and to make NFT collectibles tradable on the company’s website. 



The Dubai-headquartered airline also hopes to use blockchain technology in tracing aircraft records, as <a href="https://www.arabnews.com/node/2079876/business-economy" target="_blank" rel="noreferrer noopener">stated</a> by Emirates’ chief operating officer Adel Ahmed Al Redha in a media gathering held at international travel trade show, the Arabian Travel Market. 



The COO did not say when the new features would be available but revealed plans to recruit new employees who will focus on implementing and managing crypto payments, blockchain tracking, metaverse and NFT (non-fungible token) projects. 



He added that these blockchain-related plans are part of the carrier’s strategy to better “monitor customer needs” and make operations, training and website sales more “interactive” processes. 



Emirates first made public in April its <a href="https://www.emirates.com/media-centre/emirates-to-launch-nfts-and-experiences-in-the-metaverse" target="_blank" rel="noreferrer noopener">plan</a> to spend “tens of millions of dollars” on a strategy to extend its services to the metaverse and to develop collectible and utility-based NFTs, with a launch anticipated in the upcoming months.&nbsp;



As more Dubai-based businesses embrace blockchain and crypto, Dubai’s Virtual Assets Regulatory Authority (VARA) has also made its official foray into the metaverse. The cryptocurrency regulator recently <a href="https://cms.blockworks.co/dubais-crypto-regulator-buys-land-in-the-metaverse-for-headquarters/" target="_blank" rel="noreferrer noopener">acquired land in The Sandbox metaverse</a> with plans to establish a virtual headquarters, or “MetaHQ.”



A number of other airlines already accept cryptocurrency as payment. Latvian airline airBaltic was the world’s first to accept bitcoin payments for its flight tickets back in 2014. It now <a href="https://www.airbaltic.com/en/airbaltic-bitcoin-payments-extended-by-various-crypto-currencies" target="_blank" rel="noreferrer noopener">also accepts ether and dogecoin</a>.&nbsp;



In October 2021, El Salvador’s President Nayib Bukele <a href="https://www.reuters.com/technology/volaris-el-salvador-set-accept-bitcoin-2021-10-19/" target="_blank" rel="noreferrer noopener">announced</a> the Central American nation’s low-cost airline Volaris would accept bitcoin, but that plan has not yet been implemented.

airlines

Emirates Airline To Accept Bitcoin Payments and Launch NFT Collection

Dan Keeler

<div id="highlights-block_61cb5832ffd67" class="highlights">
 <ul>
 <li>Abu Dhabi’s determination to become a crypto hub is part of its effort to reduce its reliance on oil and gas</li>
 <li>Regulators are focused on anti-money-laundering, tech governance systems and controls, protecting client money, custody and exchange-operations risks</li>
 </ul>
 
</div>



Abu Dhabi, the capital of the United Arab Emirates, is stepping up its efforts to attract crypto-focused businesses as it seeks to become the leading cryptocurrency center in the Middle East.



In an interview with Blockworks, the Chairman of the Abu Dhabi Department of Economic Development, Shorafa Al Hammadi, said the government of Abu Dhabi had set itself a deadline of the end of this year to “ease passporting between digital cryptocurrency exchanges to ‘normal’ instruments.”



The emirate is already among the global leaders in developing a crypto-friendly regulatory environment, having established an initial framework in 2018, according to the CEO of Abu Dhabi’s Financial Services Regulatory Authority, Emmanuel Givanakis. “At that time, the industry was already talking about needing to come under a regulatory umbrella, and we came out with what we think is a fairly comprehensive framework,” Givanakis told Blockworks. 



Abu Dhabi’s neighbor and fellow emirate, Dubai, is also keen to attract digital-assets firms and last week <a href="https://www.dwtc.com/en/press/dwtca-signs-agreement-with-binance-to-participate-in-the-worlds-first-virtual-asset-ecosystem-2021" target="_blank" rel="noreferrer noopener">revealed</a> that it enlisted Binance to help it develop an “international virtual asset ecosystem.” Binance <a href="https://cms.blockworks.co/binance-scores-regulatory-win-in-bahrain-as-exchange-continues-mea-focus/" target="_blank" rel="noreferrer noopener">announced</a> on Dec. 27, 2021, that it has also received approval for a license-in-principle in Bahrain. 



Two regulated digital asset exchanges — <a href="https://www.matrix.co" target="_blank" rel="noreferrer noopener">Matrix Exchange</a> and <a href="https://midchains.com" target="_blank" rel="noreferrer noopener">Midchains</a> — are already operating in Abu Dhabi and a third, <a href="https://dex.ae" target="_blank" rel="noreferrer noopener">DEX</a>, is due to commence full operations soon, according to Al Hammadi.



<div class="wp-block-image"><figure class="alignleft size-medium"><img loading="lazy" decoding="async" width="300" height="200" src="https://blockworks-co.imgix.net/wp-content/uploads/2021/12/Shorafa-Al-Hammadi-1-300x200.jpeg" alt="" class="wp-image-13254" srcset="https://blockworks-co.imgix.net/wp-content/uploads/2021/12/Shorafa-Al-Hammadi-1-300x200.jpeg?w=300 300w, https://blockworks-co.imgix.net/wp-content/uploads/2021/12/Shorafa-Al-Hammadi-1-300x200.jpeg?w=1024 1024w, https://blockworks-co.imgix.net/wp-content/uploads/2021/12/Shorafa-Al-Hammadi-1-300x200.jpeg?w=768 768w, https://blockworks-co.imgix.net/wp-content/uploads/2021/12/Shorafa-Al-Hammadi-1-300x200.jpeg?w=386 386w, https://blockworks-co.imgix.net/wp-content/uploads/2021/12/Shorafa-Al-Hammadi-1-300x200.jpeg?w=392 392w, https://blockworks-co.imgix.net/wp-content/uploads/2021/12/Shorafa-Al-Hammadi-1-300x200.jpeg?w=329 329w, https://blockworks-co.imgix.net/wp-content/uploads/2021/12/Shorafa-Al-Hammadi-1-300x200.jpeg?w=80 80w, https://blockworks-co.imgix.net/wp-content/uploads/2021/12/Shorafa-Al-Hammadi-1-300x200.jpeg?w=1200 1200w" sizes="auto, (max-width: 300px) 100vw, 300px" /><figcaption><meta charset="utf-8">Shorafa Al Hammadi, chairman, Abu Dhabi Department of Economic Development</figcaption></figure></div>



“The whole ecosystem in Abu Dhabi…is working together to make it easy for all the actors of that space, to not only attract them but bring them here, to develop the legal framework, to find what are the pain points worldwide so we can remove them, and have a very strong robust regulatory framework for those people,” Al Hammadi said.















Abu Dhabi’s determination to become a crypto hub is part of its effort to recast its economy to reduce its reliance on oil and gas. As part of this effort, the emirate is focusing on innovation in financial technology, providing the private sector with a fintech sandbox where they can test their products in a live environment to ensure they meet the UAE’s strict anti-money-laundering (AML) and other regulatory standards. 



<blockquote class="wp-block-quote is-layout-flow wp-block-quote-is-layout-flow">“The number-one risk we are focused on is AML, but tech governance systems and controls, protecting client money, custody and exchange-operations risks are all really important risks for us,” Givanakis said. “We needed to develop systems to monitor these frameworks.”</blockquote>



Amy Oldenburg, head of emerging market equities at Morgan Stanley Investment Management, said a challenge for regulators is ensuring they don’t stifle innovation as they try to protect investors. “It’s really important for business operators that the regulators think about…how to allow for innovation and the adaptation necessary as things change,” she told Blockworks. “The UAE and Abu Dhabi seem to be striking the right balance between putting regulation around [crypto] but not so much that they’re constraining the growth and the exploration that will continue to happen for many years going forward.”



Givanakis said Abu Dhabi’s efforts to ensure it has a comprehensive regulatory framework for a broad range of digital securities, including digital funds and derivative products, are helping it attract international interest. “We’re one of the few places they feel they can establish and people try to understand them and try to understand how to regulate them,” he said.



<hr class="wp-block-separator"/>



Get the day’s top crypto news and insights delivered to your inbox every evening. <a href="https://cms.blockworks.co/newsletter/" target="_blank" rel="noreferrer noopener">Subscribe to Blockworks’ free newsletter</a> now.



<hr class="wp-block-separator"/>