While many countries are inclined to simply ban the use of Bitcoin (BTC) and digital assets, regulators in the United Arab Emirates are taking a different approach.
The country has been consistently enacting its vision of becoming a blockchain capital by providing frameworks to guide crypto businesses on how to operate in accordance with the laws.
Jurisdictions in the country are divided between the mainland, where the regulator is the Securities and Commodities Authority (SCA), and free zones — i.e., geographically specified areas within the UAE with relaxed taxation and regulatory regimes.
Such free zones include the Dubai International Financial Centre (DIFC), which is regulated by the Dubai Financial Services Authority (DFSA), Abu Dhabi Global Markets (ADGM), which is regulated by the Financial Services Regulatory Authority (FSRA), and the Dubai Multi Commodities Centre (DMCC), which falls under regulatory remit of the SCA.
In an interview with Cointelegraph, Kokila Alagh, founder and CEO of Karm Legal Consultants, shared a brief overview of the regulatory situation in the country. According to Alagh, the SCA, the mainland regulator, provides certainty and opportunities for crypto and blockchain businesses:
“The regulations provided certainty and have opened new opportunities in the UAE, which makes SCA a progressive regulator in the global landscape, as they haven’t ignored this vital growing sector and are continuously working on developing the frameworks to adjust as per these emerging sectors like DLT, blockchain.”
The FSRA, ADGM’s financial services…