Dubai regulators noted that no clients were exposed because FTX MENA was still in the preparation phase prior to receiving full operating approval. UAE regulator revokes FTX license during exchange collapse.
The Dubai Virtual Assets Regulatory Authority (VARA) has suspended the license that allowed FTX to prepare to serve the local market while the FTX saga continues to make waves in the crypto industry and beyond.
VARA stated that it had revoked the approval of FTX MENA’s Minimum Viable Product (MVP) license in an announcement that was posted on its official website. VARA confirmed that FTX MENA’s license was suspended before any clients were exposed, citing the bankruptcy filings of FTX-related entities such as FTX exchange and Alameda Research.
The regulator said that FTX MENA was still in the planning stage. The authority clarified that the company had not yet received the necessary approval to begin operations and take on customers. The regulator also pointed out that the company had not yet opened a domestic bank account, which is a requirement for virtual asset service providers to open a business in the United Arab Emirates.
Additionally, the regulator has requested disclosures from VASPs that collaborated with VARA to participate in the local virtual asset ecosystem. The regulator will be able to use this information to assess the UAE’s exposure to the domestic market and the extent of the spread.
Sam Bankman-Fried, a former CEO of FTX, made the announcement in March that FTX had been granted the first digital asset license in Dubai. The FTX exchange received approval to operate under the MVP program in July, allowing it to move forward with testing and preparations.
VARA was established as a result of the passage of a new law on March 9 that established a legal framework for cryptocurrency in Dubai.Investor protection and the development of industry governance standards are the responsibilities of the regulator.
Meanwhile, Bankman-Fried is still giving a speech at a conference that is being held by The New York Times, despite the uproar that the former FTX exchange has caused among crypto enthusiasts. Some members of the crypto community even compared Bankman-Fried to Tornado Cash developer Alexey Pertsev, who is currently in custody, in their criticism of the law.
