The United Arab Emirates is becoming an increasingly serious player in the cryptocurrency market. Later in the first quarter, they plan to introduce new legislation that will support blockchain-based companies.
Uniform law for everyone?
The United Arab Emirates’ plan to introduce new regulations supporting the so-called VASP (Virtual Asset Service Providers), i.e. providers of services related to the virtual asset market. So far, the territory of the Emirates was divided into different zones with different regulations from 2018.
The above information was shared by Bloomberg agency, according to which the new legislation is already in the final stages of creation. It is expected to help Emirates become a leading jurisdiction with one of the most favorable regulations for cryptocurrencies. Lawmakers were supposed to take into account the guidelines of the Financial Action Task Force from Paris, as well as the experience of regulators from countries such as the United States, the United Kingdom and Singapore. As it turns out, however, the new guidelines intend to leave many paths open for smaller decision makers in the country. The main regulator will work in concert with the central bank, and at the same time local institutions will be able to develop regulations tailored to their own needs. Thus, this does not rule out the existing form of the law.
Another strong move by the United Arab Emirates
This is not the first time that the UAE looks with a favorable eye towards the cryptocurrency market. As we wrote in an article titled “Dubai joins ever-growing cryptocurrency ecosystem”, Dubai World Trade Center (DWTC) is set to become a comprehensive zone and local market regulator. This is happening in conjunction with the Binance exchange, which as we know is looking for a place for its new permanent headquarters. New regulations in the UAE support this process. Recall that although the issues of Binance’s regulatory problems have recently quieted down, many jurisdictions are demanding a physical headquarters for the exchange. Therefore, it seems that Emirates will be an obvious choice for Binance CEO Changpeng Zhao.
There is also a green light for cryptocurrency miners in the new legislation. According to information provided by Bloomberg, there are provisions for construction as well as support for mining companies. This kind of strong law gives the UAE a chance to become a real world center of cryptography.