Banking & Finance Crypto giant OKX plans ‘long-term play’ in UAE after licence win By Andy Sambidge July 18, 2022 REUTERS/Leonhard Foeger OKX, which sponsors McLaren Racing, has won a Dubai licence. Here its logo can be seen on Daniel Ricciardo's car in practice for the Austrian Grand Prix Cryptocurrency trading app set to make Dubai its regional hubSeychelles-based company plans to hire 100-plus people in the UAEVirtual Assets Regulatory Authority granted OKX provisional licence Global crypto exchange OKX, which trades more than $1.5 billion daily, has revealed it is planning a “long-term play” in the UAE after securing a provisional virtual assets licence from the Dubai Virtual Assets Regulatory Authority (VARA). The Seychelles-based crypto trading app, which has more than 20 million customers in over 180 international markets, plans to hire over 100 people in the UAE, and to make Dubai its regional hub. Tim Buyn, global government relations officer at OK Group, told AGBI: “The UAE has a high concentration of crypto natives and sophisticated traders. OKX wants to galvanise this constituency and support responsible trading behaviours. Our goal is to hire extensively in this talent-rich market.” He added: “OKX will work closely with the regulators to help them understand our products and services to launch a compliant and robust platform, secure new offices to serve as OKX’s regional hub, and hire 100-plus exceptionally talented staff members from the growing Dubai ecosystem.” Crypto is ‘more like a Rolex than currency’Binance CEO warns Gulf banks they must adapt He hailed the launch of the VARA, which was set up earlier this year to regulate the industry in Dubai. “VARA is fostering an ecosystem to make Dubai the No 1 global virtual asset industry hub. Dubai and UAE leadership have embraced Blockchain technologies and continue to invest heavily in the crypto ecosystem. For OKX, it’s a natural partner jurisdiction and a long-term play, where we can attract high-quality talent and serve an engaged international crypto audience,” Buyn said. He described the VARA licence as “crucial,” as it is the basis for virtual asset businesses to conduct activities in the UAE in a “compliant manner with regulatory safeguards and mandates”. Buyn added that regulation was the way forward for the sector in the Gulf region. The UAE has been pushing to develop virtual asset regulation to attract new forms of business as economic competition heats up in the region. Dubai, one of the UAE’s seven emirates and the region’s business hub, adopted its first law governing virtual assets in March and established VARA as a regulator for the sector. OKX’s entry into the UAE comes at a difficult time for the crypto industry, with platform Celsius Network recently revealing a $1.2 billion deficit in its bankruptcy filing in the US. Blaming a combination of its own poor decisions and a global “cryptopocalypse”, the company filed for Chapter 11 – a US process that allows companies to trade while restructuring their finances. The current crypto collapse comes as a result of macroeconomic factors after the US Federal Reserve has been raising interest rates to counter inflation, leading to fewer investments in risky assets. But OKX said it remained confident, saying: “The recent liquidity crisis that has significantly affected lenders like Celsius has come about because money managers have been opaque when it comes to how they are investing users’ funds. “Investors need both better transparency about how their funds are being invested, and better control over how those investments are being handled. Offerings like OKX’s custody trading sub-accounts directly address this problem.” The Middle East and North Africa is one of the fastest growing markets for the crypto industry, and Binance, the world’s largest crypto exchange, was given a virtual assets licence by VARA in March. Global law firm Norton Rose Fulbright advised OKX on its entry into the UAE market, and will also work with it and VARA to help brainstorm an “appropriate and attractive” legal framework for the virtual assets industry to thrive in Dubai. Partner Adjou Ait Ben Idir, who heads the law firm’s Middle East corporate, M&A and securities practice, said: “There are huge opportunities in this sector within, and from the UAE, and we look forward to continuing to support our clients as great strides are being made in the crypto space across the country.” Earlier this year, the law firm advised fast-growing crypto derivatives exchange Bybit on its entry to the UAE market.