By George Ward
Oman is taking a bold step forward in virtual assets regulation by announcing plans to establish a regulatory framework for this investment category. This move comes in the face of strong warnings from the country’s central bank about the risks associated with investing in virtual assets.
Despite these warnings, Oman has seen a surge in people holding virtual assets. According to reports, about 65,000 Omani residents own cryptocurrencies such as Bitcoin, Ripple, and Ethereum.
This figure indicates the growing interest in digital assets among the Omani population. The regulations will help protect the country’s financial system from the potential risks posed by digital assets.
These new regulations will make it easier for the central bank to monitor and regulate virtual assets, ensuring that investors’ funds are not at risk.
Oman’s Financial Regulator Reviews Potential Regulatory Policies For Virtual Assets
The overseer of Oman’s financial industry, the Capital Market Authority (CMA) of Oman, is establishing a regulatory system for the digital asset industry in the Sultanate. The new regulations will involve licensing procedures for virtual asset service providers (VASPs).
It also includes overseeing virtual asset activities and a structure to identify and manage the risks associated with this new asset class. According to the announcement, “the purpose of this new regulation is to create a framework for virtual assets that will include provisions to guard against market manipulation, such as extensive monitoring and enforcement measures.”
The proposed regulations encompass a variety of virtual asset activities, such as the issuance of tokens, crypto assets, crypto exchange products and services, and initial coin offerings. CMA (Capital Market Authority) sought the help of Said Al-Shahry and Partners, Advocates & Legal Agency (SASLO), an Omani legal corporation, and XReg Consulting Limited, a virtual assets policy and regulatory consultant, in drafting the new rules.
Furthermore, the financial regulatory authorities aligned the proposed regulatory system with Oman’s Vision 2040 to revolutionize the nation’s economy and attract digital businesses globally.
With the proposed regulatory control, Oman seeks to become a leader in digital asset acceptance in the Middle East. At the same time, the country’s central bank has shown more caution concerning cryptocurrencies.
Oman Citizens Key Into Crypto Despite The CBO’s Warning0
The Central Bank of Oman (CBO) issued a cautionary statement last October warning citizens to be vigilant when making transactions involving cryptocurrencies due to the associated dangers of fraud. The CBO has issued several warnings stating that the country has not authorized any entity to trade in digital currencies.
Meanwhile, Oman’s banking laws do not cover activities related to digital or virtual currencies. Despite the warning from the government, many Omanis have continued to purchase and invest in cryptocurrencies.
A Souq Analyst survey revealed that around 65,000 individuals, 1.9% of the adult population, now own digital currencies. Additionally, the survey found that 62% of individuals hold their crypto for the long term.
In comparison, 25% use them for learning and educational purposes, and the remaining 13% use them for day-to-day trading.