On Friday, FZE, a subsidiary of crypto exchange FTX, was awarded Dubai’s first Minimum Viable Product (MVP) license, allowing the exchange to operate fully in the region.
Dubai’s Virtual Asset Regulatory Authority (VARA) has issued the operating license to FZE under the MVP program, which, according to Helal Saeed Almarri, Managing Director of the Dubai WTC Authority, is designed for safe and sustainable growth in Dubai. For now, the operations of the FTX FZE exchange are in the testing phase and will focus on providing various crypto services.
According to FTX CEO Sam Bankman-Fried, the newly licensed exchange will operate under a model that incorporates regulatory oversight and Financial Action Task Force (FATF) compliance checks aimed at Tier 1 international capital markets. revealed that the exchange’s operations will serve as a regulatory trial for future trading services using virtual assets.
“The MVP phase, exclusive to certain responsible international players like FTX, will allow VARA to carefully structure guidelines and risk mitigation levers for secure business operations,” Almarri said, underscoring the region’s readiness to adopt largely cryptography.
With the license, FTX FZE was allowed to deploy regulated crypto derivatives and trading services to qualified institutional investors. In addition, the exchange may also act as a clearing house, operate a non-fungible token (NFT) market and provide daycare services throughout the region.
In March 2022, FTX was the first to receive Dubai’s Virtual Asset Exchange (VAX) license shortly after regulators signed the Virtual Assets Act and established Dubai’s VARA. OKX crypto exchange too received a provisional permit regulatory authorities in Dubai to provide additional services to local investors and financial service providers.
Dubai and the rest of the UAE have taken steps to embrace cryptocurrency at a rapid pace this year. The emirates took their innovation bet a step further earlier this year with the launch of Dubai Metaverse Strategy.
The interest of financial authorities for crypto-currencies and the major exchange approval sets the tone for regulators around the world. While some countries focus on tighter controlsDubai’s experimental approach and the green light recently given to the European Union Crypto Asset Markets proposal could serve as a reference for other regions.