- The crypto exchanges' Europe subsidiary will offer complex crypto derivatives to institutional clients.
- FTX also has plans to set up its regional headquarters in the city
Sam Bankman-Fried's crypto trading platform FTX has become Dubai's premier recipient of a virtual asset exchange (VAX) licence, according to a press release sent out today. The American exchange's Europe and Middle Eastern subsidiary, FTX Europe, will now be operating legally in the city and would play a role in Dubai's push to spur the growth of global virtual assets regulation.
"Really excited to receive the first (and so far only) digital asset exchange licence from Dubai!" SBF tweeted following the news.
The licence allows FTX to offer enterprise investors exposure to complex crypto derivatives. CEO Bankman-Fried said the approval is a testament to his exchange's commitment to achieving regulatory compliance worldwide. He said that his firm will continue being a disruptor in other jurisdictions that have a crypto regulatory framework and investors' welfare in mind.
"FTX is proud to be the first licensee under Dubai's prudential supervision regime. It's an honour to be one of the first approved applicants in such a specialised category, and we are excited to be able to introduce complex crypto-derivatives products with centralised counterparty clearing to institutional markets," Bankman-Fried said in the released statement.
The exchange also disclosed its plans to set up a regional headquarters in Dubai.
A changing crypto landscape in the Gulf region
The recent approval of FTX in Dubai follows an official confirmation by Binance exchange on Monday that revealed the exchange had received a licence to operate as a virtual asset service provider in Bahrain.
The announcements signify a growing wave of interest by crypto firms to set up shop in the Gulf region. Reasonably, a move into Dubai by motivated crypto firms was already on the cards, considering that a new crypto law was approved last week by the prime minister of the United Arab Emirates.
Sheikh Al Maktoum announced last Wednesday that the Emirate of Dubai was adopting a law to create a regulatory framework for crypto. The Sheikh also said that a new virtual asset regulator, Dubai Virtual Asset Regulatory Authority (VARA), had also been formed to enforce the regulatory set up to protect investors.
The regulator will practice oversight on virtual asset service providers, platforms, and portfolios to ensure conformity with the highest standards. The new regulatory framework in Dubai is modelled to globally acceptable standards as defined by major regulatory bodies such as the Financial Action Task Force (FATF).
According to unofficial reports, crypto exchange Binance will also set foot in Dubai, as it has also received a licence to operate as a VASP.