The United Arab Emirates (UAE) plans to issue the first federal licenses to Virtual Asset Service Providers (VASPs) by the end of the first quarter of 2022.
According to Bloomberg, the UAE Securities and Commodities Authority (SCA) is in the final stages of amending the legislation that will allow VASP to set up their shops in the country, The regulator believes that the move will attract some of the largest crypto companies to the local market.
According to the documents that came into the hands of Bloomberg journalists, a number of special economic zones have already issued permits for VASP. In particular, 22 companies in the Dubai Multi Commodities Centre, six in Abu Dhabi Global Market companies, and at least one in Dubai Silicon Oasis have received such licenses.
Speaking to Bloomberg, the official noted that the UAE is taking a hybrid approach. The Securities and Commodities Authority (SCA) and the central bank will regulate the market at the state level, while local financial centers will be able to establish their own licensing procedures. He stressed that the latest Financial Action Task Force (FATF) guidelines were taken into account when drafting the bill.
The report said that the UAE government also plans to create an “ecosystem for cryptocurrency mining” in the country and, this sector will be also be regulated at the state level.