By George Ward
According to reports, Deribit Exchange, a crypto options platform, is considering setting up an office in Dubai. Reports reveal that this move will take place in Q3 2023 if authorities in the famous city provide clear crypto regulations.
Deribit Ready To Apply For Crypto License In Dubai
A Chief Legal Officer at Deribit, David Dohmen, announced the news recently. According to Dohmen, ten individuals who will make up the support, compliance, and management staff would run the new office at first.
In addition, the ten individuals will comprise some of the firm’s current employees and local hires. Currently, Deribit is operating in Amsterdam and Panama.
However, reports state that the company has applied for a full license from Dubai’s crypto regulator, VARA (Virtual Asset Regulatory Authority). Notably, Deribit’s plan to expand into Dubai is part of its effort to regain users’ trust and confidence.
The November FTX debacle shattered investors’ trust in crypto exchanges, and Deribit wants to regain that trust. Furthermore, the legal officer said the crypto options platform would hire a leading auditing firm to audit its proof-of-reserves.
The company also plans to provide snapshots of its PoR daily. Dohmen indicated that Deribit’s plan to relocate to Dubai was partly driven by clients’ requests to trade crypto on a licensed platform.
“Some of our clients have met us stating their desire to trade on regulated crypto exchanges,” Dohmen said. Furthermore, Dohmen argued that Panama, where Deribit currently operates, does not have sound crypto regulations.
The compliance officer admits the recent FTX incident is enough reason for countries to enforce stronger crypto regulations.
Dubai Tightened Crypto Regulations After FTX Saga
Meanwhile, Dubai has developed itself into a destination for crypto exchanges looking for a more favorable regulatory environment. The country has granted crypto trading licenses to numerous crypto platforms such as Bybit, Binance, and Komainu.
However, the tourist city is still struggling with a property market slump. This slump has affected its well-known real estate business causing the government to look for solutions.
On the other hand, Dubai has been striving to recruit more crypto enterprises to grow its digital economy. Recently, the government announced a plan to bring over 1,000 metaverse and blockchain projects to Dubai.
The country aims to provide 40,000 digital-related jobs by 2030 through its metaverse initiative. In 2022, Dubai showcased a progressive attitude towards cryptocurrency. However, the failure of notable crypto firms like FTX has caused the regulator in this region to reevaluate the city’s goal of becoming the leading cryptocurrency hub in the Middle East.
At the beginning of 2023, Dubai regulators unveiled strict guidelines for crypto firms that want to set up offices in the state. In the past few months, the Dubai authorities have been concerned about protecting crypto investors in the state.