(MENAFN- Khaleej Times) Dubai World Trade Centre Authority (DWTCA) announced on Wednesday that it would support the regulation, offering, issuance, listing, and trading of crypto assets and related financial activities within its free zone as part of its drive towards innovation and digital-led economy.
The announcement on this initiative came in the wake of an agreement to this effect signed by the Securities and commodities Authority (SCA) and the DWTCA. Under the agreement, the SCA will oversee, monitor, and inspect entities operating within DWTCA's free zone.
In May, the Dubai Airport Free Zone Authority signed a similar agreement with the SCA. Dubai's DMCC freezone opened a blockchain-based exchange for sugar trading last year and the Bitcoin Fund was listed on the Nasdaq Dubai exchange in June -- the first of its kind to trade in the region.
“The agreement establishes a framework that allows the DWTCA to issue the necessary approvals and licences for the conduct of financial activities relating to crypto assets,” the Dubai entity said in a statement.
Dr Maryam Al Suwaidi, acting chief executive officer of SCA, and Helal Saeed Almarri, director-general of the DWTCA and Dubai Department of Tourism and Commerce Marketing (DTCM), signed the agreement.
“The DWTCA has signed the agreement to expand its existing business licences, services and incentives. In collaboration with the DWTCA, the SCA will handle the regulatory oversight of the issuance, offering, listing, and trading of crypto assets as well as the licensing of the associated financial activities that fall under DWTCA's jurisdiction,” said the statement.
Financial analysts said Dubai is well-positioned to benefit from the growing cryptocurrency market in the Middle East as its regulators lead a push toward acceptance of blockchain-based technologies. Dubai, the region's financial hub and tax haven, has already taken several steps to bolster the use of blockchain within the city in recent months, and Stonberg expects Middle Eastern sovereign wealth funds to also make blockchain allocations.
“The agreement comes in response to directives from Abdulla bin Touq Al Marri, Minister of Economy and the SCA Board Chairman, to enhance cooperation and exchange knowledge and expertise with various government departments, authorities, and institutions to work collaboratively and achieve common goals,” said Dr. Al Suwaidi.
He said the SCA would be responsible for the regulatory supervision of offering, issuing, trading and listing crypto assets and the licensing of financial activities related to them within the limits of the DWTCA free zone.“The SCA will also supervise, control and investigate the licensed entities that operate within the free zone.”
Almarri said the DWTCA is committed to expanding its services as a free zone of choice for the international investment and entrepreneurial community.“As Dubai continues its drive towards an innovation and digital-led economy, the DWTCA is looking to support businesses underpinned by blockchain and cryptographic technologies. Our agreement with the Securities and Commodities Authority will allow the DWTCA to broaden its regulatory, licenses and services capabilities, in addition to extending the centralised supervision of the crypto market to our free zone.”
He said with the rise of new technologies such as non-fungible tokens set to play an important role in the future of commerce, and building on the Future Blockchain Summit, the DWTCA is also pursuing ways to offer a sustainable home for this ecosystem, in order to stay future-ready.“The UAE has been at the forefront of blockchain research and implementation and our ambition is in line with the Emirates Blockchain Strategy,” said Almarri.
The DWTCA provides a well-regulated ecosystem for businesses seeking local and international opportunities, while the DWTCA Free Zone provides an ideal environment for startups, SMEs and corporations to operate locally while reaching international markets.
The SCA and the DWTCA will exchange best practices relating to the project, as well as delivering mutual technical support to enhance their understanding of both organisations' financial systems. The partnership will also include the provision of professional services that specify the responsibilities and obligations of both parties. —
Issac John Editorial Director of Khaleej Times, is a well-connected Indian journalist and an economic and financial commentator. He has been in the UAE's mainstream journalism for 35 years, including 23 years with Khaleej Times. A post-graduate in English and graduate in economics, he has won over two dozen awards. Acclaimed for his authentic and insightful analysis of global and regional businesses and economic trends, he is respected for his astute understanding of the local business scene.
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