Crypto exchange OKX receives provisional licence for Dubai

The trading app plans to establish a regional hub at the Dubai World Trade Centre

OKX plans to establish a regional hub in Dubai to help develop the virtual asset ecosystem. Photo: Razan Alzayani / The National

Cryptocurrency trading app OKX has been granted a provisional virtual assets licence by the Dubai Virtual Assets Regulators Authority (Vara), the company said on Thursday.

The cryptocurrency 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", it said in a statement.

The licence will allow OKX to provide certain services to qualified investors in the Emirates, the broader GCC, Africa and elsewhere.

Vara serves as the single custodial entity mandated to licence and govern the burgeoning cryptocurrency sector in Dubai, including all mainland and free zones, excluding the autonomous Financial Free Zone at the Dubai International Financial Centre.

"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 said.

"Education and safeguarding users’ assets remain the utmost priority to us — and we feel this latest licence will help us move the industry forward into a safer and more user-friendly environment."

In March, Dubai adopted the first law in the emirate that regulates virtual assets. In the same month, the Dubai Financial Services Authority, the regulator of the emirate’s financial hub, published its regulatory framework overseeing crypto tokens, or cryptocurrencies, for public consultation.

A host of crypto trading platforms have in recent months secured licences to operate in Dubai.

They include CoinMena, Bahrain's Sharia-compliant crypto assets trading platform. They also include Binance — the world’s largest cryptocurrency exchange — BitOasis, Bybit and FTX Europe.

The digital economy contributes about 4.3 per cent to the UAE's gross domestic product, which is equivalent to Dh100 billion ($27.22bn), government figures show.