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Ras Al Khaimah, one of the seven emirates that make up the UAE, will introduce a free zone for digital and virtual asset companies as the country’s approach to the industry continues to attract global crypto players.
RAK Digital Asset Oasis (RAK DAO) will be a “purpose-built, innovation-enabled free zone for non-custodial activities in the virtual asset space.” Applications will open in the second quarter of 2023, the statement said.
The free zone will be dedicated to digital and virtual asset service providers in emerging technology areas such as metaverse, blockchain, utility tokens, virtual asset wallets, NFTs, DAOs, dApps, and other Web3-related businesses.
“We are building the free zone of the future for the companies of the future,” said Sheikh Mohammed bin Humaid bin Abdullah Al Qasimi, chairman of RAK ICC, the operator of the new free zone. “As the world’s first free zone exclusively for digital and virtual asset companies, we look forward to supporting the ambitions of entrepreneurs from around the world.”
A free zone or free trade zone is an area where entrepreneurs have 100% ownership of their businesses and has its own tax scheme and regulatory framework, with the exception of the UAE’s penal code.
Dubai-based crypto lawyer Irina Heaver laid out the steps for the new free zone, arguing that “RAK DAO will start with non-financial activities first, and then financial activities may be introduced at a later stage.” She added:
“[Entrepreneurs] It is not yet possible to launch a cryptocurrency exchange, which is a financial activity regulated by ESCA. “
The Securities and Commodities Authority (SCA) is one of the main financial regulators in the UAE.latest according to country Federal level virtual asset lawsThe SCA has authority throughout the UAE, with the exception of the financial free zones – ADGM and DIFC, which have their own financial regulators.
The new free zone adds to the country’s more than 40 multidisciplinary free zones, attracting numerous cryptocurrency, blockchain and Web3 companies, including Dubai Multi Commodities Center (DMCC), Dubai International Financial Center (DIFC), Abu Dhabi Global Markets (ADGM).
The UAE portrays itself as a forward-thinking hub for cryptocurrency companies to focus on more regulatory-friendly jurisdictions. Last March, dubai unveiled Its Virtual Assets Act, along with the Virtual Assets Regulatory Authority (VARA), aims to protect investors and provide standards for the digital asset industry.
In September, ADGM’s regulator, the Financial Services Regulatory Authority, published its guiding principles Regarding its approach to regulation and oversight of new asset classes and their service providers.
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