UAE sets stage for blockchain giants with free zone launch – Cryptopolitan
The United Arab Emirates (UAE) continues to attract global crypto players with its friendly regulations towards the digital asset industry. The latest development is the launch of a free zone in Ras Al Khaimah dedicated to digital and virtual asset companies.
The free zone, called the RAK Digital Assets Oasis (RAK DAO), will accept applications in the second quarter of 2023. It will be a purpose-built, innovation-enabling free zone for unregulated activities in the virtual assets sector.
The free zone will focus on service providers of digital and virtual assets in emerging technologies, such as blockchain, metaverse, utility tokens, virtual asset wallets, non-fungible tokens (NFT), decentralized autonomous organizations (DAO), decentralized applications (DApps), and other Web3 -related businesses.
Freezones in the United Arab Emirates are areas where entrepreneurs have 100% ownership of their businesses and have their own tax regimes and regulatory frameworks, apart from the UAE’s criminal law. With the RAK DAO, the UAE aims to attract more foreign direct investment and position itself as a global technology hub.
Sheikh Mohammed bin Humaid bin Abdullah Al Qasimi, Chairman of RAK International Corporate Centre, the operator of the new free zone, said:
We are building the free zone of the future for the companies of the future. As the world’s first free zone dedicated exclusively to digital and virtual asset companies, we look forward to supporting the ambitions of entrepreneurs from around the world.
The UAE’s approach to virtual assets
The UAE has invested heavily in developing its infrastructure and implementing policy reforms to attract more entrepreneurs and businesses to the country, with the aim of growing its non-oil sector.
The national digital economy is expected to grow to more than $140 billion by 2031, up from nearly $38 billion currently, according to a report by the Dubai Chamber of Digital Economy.
Meanwhile, regulatory agencies in the country have passed laws to streamline and oversee the digital asset industry.
Dubai passed the Dubai Virtual Asset Regulation Law in March last year, which aims to create an advanced legal framework to protect investors and provide international standards for the management of virtual assets that promote responsible business growth in the emirate.
RAK DAO’s steps
Dubai-based crypto lawyer Irina Heaver believes that “RAK DAO will start with non-financial activities first, and then introduce the financial activities at a later stage.” She added that entrepreneurs “will not be able to launch a crypto exchange yet, which is an ESCA-regulated financial activity.”
The Securities and Commodities Authority (SCA) is one of the UAE’s main financial regulators. According to the country’s latest law on virtual assets at the federal level, the SCA has authority throughout the Emirates, except for the financial free zones – Abu Dhabi Global Market (ADGM) and Dubai International Financial Center (DIFC), and others, which have their own financial supervisory authorities.
RAK Digital Assets Oasis will support companies with innovation-enabling adoption frameworks, advisory and professional services, hybrid workspaces, accelerators and incubators, sandboxes and access to funding.
The UAE offers more than 40 multidisciplinary exemptions, where foreigners and foreign investors can have full ownership of companies, according to the Ministry of Economy.
