UAE to pursue VSP licenses by the end of the year

UAE plans to license virtual asset service providers (VASPs) by Q1 2022 in a bid to become a global crypto hub. 

A series of legislative amendments are being prepared by the Securities and Commodities Authority (SCA) to set up VASPs. 

With the race to become a preferred crypto destination gaining steam, this is deemed a strategic move to lure the top global crypto companies to set up shop in the UAE.

The world’s largest crypto exchange, Binance Holdings Ltd., is one of the largest crypto players in the country. 

Besides offering full regulatory oversight, the licensing system will help the UAE become a safe haven for cryptocurrency firms as other financial hubs are looking to become cryptocurrency trading centers. 

The positive taxation system and island lifestyle of Puerto Rico, on the other hand, make it an ideal location for crypto investment. 

In the Middle East region, interests are shifting from oil to crypto as more nations explore crypto and metaverse. 

The UAE ranked third among Middle Eastern markets for crypto trading between July 2020 and June 2021, according to blockchain research firm Chainalysis.  

There have been a variety of free zones established in the UAE over the years, including those in Abu Dhabi and Dubai. The Dubai Multi-Commodities Centre (DMCC) free zone granted crypto companies approval to operate last January. 

According to the official, in addition to crypto-mining, a regulated ecosystem is being developed in the country.