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UAE Considering To Create Framework For Regulation Of Virtual Tokens


Feb 13, 2018 Posted /  1855 Views


UAE Considering To Create Framework For Regulation Of Virtual Tokens

Financial Services Regulatory Authority (FSRA) of Abu Dhabi is considering to set a frame of regulations for the circulation of virtual tokens in the territory. From the statement by International Financial center about regulations regarding cryptocurrency, it can be anticipated that the government might legalize digital coins such as Bitcoins.

In an interview with Reuters the regulator said: “In considering such a framework, the FSRA intends to consult and work closely with industry participants and relevant professional bodies,”.

In its previous statements, the government of UAE neither show any support for digital tokens nor passed any negative statement. Last September the status of UAE regulators got apprehended when Dubai Financial Services Authority warned crypto investors to be cautious as it did not come under government regulators.

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In October, the apex bank of UAE said that bitcoin or any other virtual token is not recognized as currency and government do not encourage its circulation. The officials further said that the virtual currency involves risk factor and can be used for money laundering and terrorist activities as well.

“The FSRA notes that virtual currencies, although not legal tender, are gaining interest globally as a medium of exchange for goods and services,” – The regulator said.

From the above statement, it can be apprehended that FSRA may endorse the usage of digital coins but within the boundings of Abu Dhabi Global Market (ADGM).

Elsewhere in the Gulf, the apex banks are suggesting to maintain distance from virtual tokens. Last week, Saudi Arabia regulators suggested traders not to deal in cryptocurrencies and Qatar’s central bank summoned banks not to accept any cryptocurrency.

In contrary to it the competitor of United Arab Emirates, Bahrain is exploring the ways of using Bitcoins and also creating a “regulatory sandbox” where companies would be able to test Innovations in financial field that too without any burden of regulations. The two regions have always been trying to stay ahead of each other in terms of Financial Services.

 


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