OKX, formerly known as OKEx, has secured a provisional virtual assets licence to operate in Dubai. The Seychelles-based cryptocurrency exchange has obtained the approval from Dubai’s Virtual Assets Regulatory Authority (Vara) and plans to expand its operations in the UAE.
OKX is the fourth cryptocurrency exchange to receive licence after FTX Europe, Bybit and Binance were given similar licenses in the last few months in 2022 to launch their operations in the UAE. It is the second largest crypto exchange in the world.
The crypto exchange plans to establish a regional hub at the Dubai World Trade Centre in an effort to contribute to developing both Dubai and the world’s always-expanding virtual asset ecosystem.
The in-principal approval allows OKX to conduct a spectrum of virtual assets business under the initial regulatory phase of VARA, which serves as the single custodial entity mandated to license and govern crypto activities in Dubai.
This includes offering exchange products and services to pre-qualified investors and professional financial service providers under strict oversight and mandatory FATF compliance controls. To get access to the retail market, OKX will be progressively monitored in stages alongside all licensed VARA service providers.
Hub of Crypto Ecosystem
“The Middle East and North Africa (MENA) region is one of the crypto industry’s fastest-growing markets, and we are proud to meaningfully contribute to its free exchange of ideas and future regulatory framework. Dubai is also a pioneer in the virtual asset industry, and we are excited to participate in its sound compliance framework and development,” OKX said.
Dubai has been one of the progressive Emirates in the UAE for digital assets in the world and OKX’s regulatory foray into the Emirate comes as no surprise. In fact, the announcement is the latest in a string of approvals secured by top crypto platforms as Dubai pushes to become the regional hub for the digital asset sector.
Notably, the UAE was the first global economy to have set up a specialised regulator for the virtual asset sector. Announced by the Dubai ruler His Highness Sheikh Mohammed bin Rashid Al Maktoum, the Emirate has enacted its first law governing cryptocurrency activities, and it has also formed an independent regulator to supervise the sector in March this year.
“As a proponent of sound regulation, we will engage in constructive dialogue to advance regulatory and legislative dialogue while facilitating research and the sharing of knowledge to promote Dubai as an industry hub,” OKX added.
Range of Services
The crypto exchange will offer products and services to pre-qualified investors and financial service providers in the region. In fact, OKX has announced last month that it planned to recruit 100 employees in the region.
VARA-approved crypto exchanges and firms are obligated to follow the market model of testing, adjusting, and scaling. Initially, pre-qualified investors and professional financial service providers can get a limited range of exchange products and services. After that, VARA keeps an eye on the markets before granting access to other retail investors.
Even Singapore-based crypto exchange Crypto.com last month announced its expansion in Dubai. Another crypto exchange Kraken is also expanding its presence in the Emirate. CoinMena, Bahrain’s Sharia-compliant crypto assets trading platform, is also operating in Dubai.
The digital economy contributes about 4.3 per cent to the UAE’s gross domestic product, which is equivalent to $27.22 billion, according to the government.