Dubai's Virtual Assets Regulatory Authority (VARA) has assured businesses that it will release a comprehensive framework they can use by the end of the year.
Banks are reportedly still hesitant to join.
CoinDesk reported that multiple sources informed the publication of this deadline, which comes as desert rain for businesses in the industry.
Dubai has been trying to become a new crypto hub for a while now, and establishing VARA was one of the biggest – and necessary – steps to accomplish that.
However, regulation has been largely unclear, and CoinDesk reported that even setting up a bank account wasn’t easy. To be fair, it has been less than a year since the regulatory body started operation.
During the summer the Dubai Metaverse Strategy was announced. Its target was at least 1,000 blockchain and metaverse companies and at least 40,000 employees by 2030.
Bybit and Crypto.com are two companies that can seriously help in achieving that target, and both have made their intentions public.
Binance’s plans to expand into the middle east also coincided with Dubai looking to attract crypto companies. So, Binance was a natural add to the list of interested companies for the region, and the city, and it even got licensed.
First it received its Minimal Viable Product (MVP) license, followed by a Virtual Asset License (VAL), which is issued to companies that VARA recognizes as virtual asset service providers (VASPs).
The MVP license enabled Binance to open a domestic bank account, while its VAL grants it permission to extend is permissible exchange products and services to investors that are qualified by VARA.
This process, however, along with the resulting products and services that a licensee can provide, all need to be polished further.
CoinDesk’s report mentioned multiple industry participants being very bullish on the notion that not only this is feasible but also inevitable. Dubai is one of the first to establish a regulatory body with the sole purpose of regulating crypto.
However, with it being a relatively new industry in the region, establishing a regulatory framework alone likely won’t be enough to attract many banking institutions.
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