UAE emirate launches new free zone for digital assets, Web3 and AI

October 19, 2023 Coin Telegraph

Adoption

Ras Al Khaimah, known for its rich cultural sites, is turning to the virtual assets sector to diversify its economy away from traditional avenues such as tourism.

Ras Al Khaimah ruler Sheikh Saud bin Saqr Al Qasimi inaugurated the new RAK Digital Assets Oasis (RAK DAO), an economic free zone dedicated to supporting companies involved in digital and virtual assets, blockchain, Web3, and artificial intelligence (AI), on Oct. 19.

As previously reported by Cointelegraph, the free zone will be dedicated to digital and virtual assets service providers in emerging technologies, such as the metaverse, blockchain, utility tokens, virtual asset wallets, nonfungible tokens (NFTs), decentralized autonomous organizations (DAOs), decentralized applications (DApps) and other Web3-related businesses.

RAK DAO and its ecosystem partners will also run grant programs, and specialized support in various areas of technology, marketing, and business development.

“When we embarked on this… journey, our vision was to create a hub where digital assets could thrive, innovation could flourish, and groundbreaking ideas could come to light,” Sheikh Saud said in his opening remarks. “We wanted to provide a platform to foster its growth and success. He added:

“We observed that global trends and data point to the incredible opportunity digital assets offer, and we felt… that Ras Al Khaimah could and should benefit from being a first adopter.”

A memorandum of understanding (MoU) was also signed between the Securities and Commodities Authority (SCA) CEO Maryam Buti Al Suwaidi and RAK DAO chief executive Sameer Al Ansari.

Cointelegraph reached out to RAK DAO for further comments but didn’t get an immediate response.

Ras Al Khaimah, known for its rich cultural sites, is turning to the virtual assets sector to diversify its economy away from traditional avenues such as tourism. However, the new free zone has entered a space where more popular technology hubs in Abu Dhabi and Dubai are already attracting global crypto firms.

RAK DAO joins the UAE’s list of Web3-friendly free zones — areas where entrepreneurs have 100% ownership of their businesses and have their own tax schemes and regulatory frameworks, except for the UAE’s criminal law — including the Abu Dhabi Global Market (ADGM), Dubai Multi Commodities Centre (DMCC) and Dubai International Financial Centre, among others.

Sheikh Saud issued Law No 2 of 2023, which decrees the establishment of RAK DAO as part of its economic diversification efforts and attempts to attract global players, the Emirates News Agency reported in March. The legislation grants the free zone financial, administrative, and legislative independence, allowing it to function as a purpose-built, innovation-enabling free zone for the virtual assets sector.

RAK DAO has since added several partners to help grow its ecosystem, including the HBAR Foundation, local bank RAKBANK, and Romanian AI firm Humans.ai.

Bahrain’s Bank ABC using JPMorgan’s Onyx blockchain for cross-border payments

September 26, 2023 Coin Telegraph

Coin Telegraph

After two years of experiments, JPMorgan and the Bahraini bank will offer U.S. dollar payment settlement in several countries, with plans to expand to euro service as well.

Bahrain-based Bank ABC will use JPMorgan’s Onyx Coin Systems for blockchain-based cross-border payments in a soft, or limited, launch. The new service will be more cost effective and reduce settlement times relative to traditional solutions.

Bank ABC will at first use the U.S. dollar in transactions involving Bahrain, the United States, United Kingdom, Singapore and Hong Kong. The partners are planning more locations and transactions with the euro as well. Programmable payments are also in the works.

The service has been launched after two years of experiments. Global head of Onyx Coin Systems Naveen Mallela said in a statement:

“This enables cross-border commercial transactions to be executed between Bahrain and US corridors instantly, atomically and with certainty.”

The new service was developed in close collaboration with the Central Bank of Bahrain (CBB). The CBB supervised a trial in January 2022 in which JPM Coin was used to settle payments between the national Aluminium Bahrain and its U.S. counterparties through Bank ABC.

Bank ABC has the first partnership with JPMorgan’s blockchain service in the Middle East, according to the statement. Earlier this year, Onyx linked up with six Indian banks in a pilot project to offer USD settlement. It also partnered with the German Siemens conglomerate for settlement in euros. JPM Coin was launched in 2020.

Bahrain’s ABC Bank goes live with Blockchain payments rail from JP Morgan After two years of trials! #payments #blockchain #Onyxblockhain #JPMorgan #payments #banking #bahrain #digitalpayments #GCC #MENA #abcbank @ABCBankGroup @CBB_News @jpmorgan https://t.co/3svnrtFJM4 pic.twitter.com/9LixnA3X1v
— lara Abdul Malak laraontheBlock (@larissa74leb) September 26, 2023

Bahrain has been taking steps to modernize its financial system in recent years. Binance received a license in the kingdom in March 2022, beating Dubai as the first member of the Cooperation Council for the Arab States of the Gulf to license an international crypto exchange by a few days. Binance partnered with EazyPay to provide retail payment services in Bahrain, although it is not clear whether that service is still available.

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Binance pledges $3M in BNB to Morocco earthquake victims

September 12, 2023 Coin Telegraph

Binance

Binance said it will issue a series of airdrops worth up to $100 in BNB to users located in Morocco’s highly impacted Marrakech region.

Cryptocurrency exchange Binance has pledged millions of dollars in BNB (BNB) as aid relief for those affected by the large earthquake that struck Morocco on Sept. 8, causing at least 2,000 fatalities in Marrakech alone, the country’s fourth-largest city.

According to a Sept. 11 announcement, Binance will airdrop up to $3 million in BNB to users identified as living in the affected areas.

The earthquake was magnitude 7 on the Richter scale, which categorizes it as “major.”

Changpeng Zhao, founder and CEO of Binance, called the earthquake “devastating” for the Moroccan people and said his heart goes out to the country.

Our hearts go out to the people in Morocco#Binance to donate $3,000,000 in #BNB to our users in Morocco

We standby our users in times of need. Stay strong. https://t.co/lQzLvhuuQ3
— CZ Binance (@cz_binance) September 11, 2023

He also called for users unaffected by the incident to distribute the funds to those most in need:

“For Moroccan users who receive these donations but are unimpacted by the earthquake, we ask them to pass the funds on to those most in need.”

Binance said it will identify users in the region using a proof-of-address protocol completed before the disaster. Users in the Marrakech-Safi province, the most affected region, will receive $100 worth of BNB directly to their Binance accounts.

For Moroccan users outside of the Marrakech-Safi area, Binance plans to airdrop $10 in BNB each. It expects nearly 70,000 Binance users living in the country to receive some level of aid starting Sept. 12.

It also said it created a public wallet address that is accepting contributions for additional aid, which can be made in BNB, Bitcoin (BTC), Ether (ETH), USD Coin (USDC), Tether (USDT) and Binance USDC (BUSD).

In March, Binance carried out a similar aid scheme to those affected by the intense earthquakes that hit the Turkey-Syria border region, also with $100 airdrops in BNB tokens.

Crypto has been increasingly used as a medium through which aid is made accessible to victims of disasters and as a means of charity.

Following the devastation of the Turkish-Syrian earthquake, many major players in the Web3 space used crypto as a means of dispersing aid to impacted communities, including Binance, The Sandbox, Bitget, Tether and Gate.io, among others.

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Saudi Arabia looks to blockchain gaming and Web3 to diversify economy

September 8, 2023 Coin Telegraph

Blockchain Game

The kingdom is currently diversifying its economy away from oil and turning to new opportunities, such as gaming and Web3.

Saudi Arabia has ramped up its economic diversification efforts driven by its ambitious Vision 2030.

In a bid to diversify its economy away from a dependence on oil, the kingdom has embraced emerging technologies, such as blockchain and artificial intelligence (AI), and tapped into booming markets like gaming.

But while the country has yet to leave a significant mark in the global game and AI development, the ripples of its investments in the gaming sector could extend far beyond — at least, that’s what Web3 experts say.

“Based on our work and communications that we have, Saudi [Arabia] is very, very interested in Web3,” Animoca Brands co-founder Yat Siu told Cointelegraph.

Given the kingdom’s partnerships with entities such as The Sandbox and even Animoca, Siu sees that there’s an effort from Saudi to venture into the new iteration of the internet. The executive said:

“I think Saudi [Arabia] understands the principle that Web3 gaming or blockchain gaming — the one that we actually prove the owner assets — is going to be the future of gaming.”

Thanks to the interest of its young, tech-savvy population, Saudi Arabia, along with the United Arab Emirates, is driving the growth of the Middle East’s gaming market. According to a Boston Consulting Group report, the kingdom represents 45% of the sector in the region, with a value of more than $1.8 billion. It also boasts one of the largest game revenues in the area, according to game content studio Allcorrect.

In 2017, the kingdom established the Saudi Esports Federation to regulate and develop the country’s gaming industry.

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Bloomberg reported in April that Saudi Arabia, through its Public Investment Fund, invested $38 billion in the sector as it looks to become a global gaming hub.

Although the Saudi government understands the “high-level concept” of Web3, its potential, and how it can align with esports — where teams can own stakes in games they play — Siu said it remains unclear what its integrations to gaming would be due to the absence of clear rules on cryptocurrency and other virtual assets:

“Cryptocurrency is something that is still to be explored. It’s being investigated. I think [Saudi Arabia is] quite forward about how to deal with it. But they haven’t come up with anything yet.”

“In places like Hong Kong, Japan and the UAE, there’s much more clarity as to what you can do with crypto and Web3. You can map out a strategy,” Siu added.

While it remains to be seen what Saudi Arabia’s Web3 gaming applications would look like, Siu noted that the kingdom is looking at other markets and learning.

“That’s why they’re talking to us. Because they want to know what the best practices are and how they can learn,” the executive explained. “There are very few places in the world that we’ve seen such a hunger and desire to sort of be at the cutting edge.”

“You can feel sort of the desire to have progress and to lead in Saudi Arabia. I think that’s kind of unique,” Siu added.

How gaming can spur Web3 adoption

While pushback from the traditional gaming community and developers persists, Siu claims a successful conversion of users into Web3, whether it’s in gaming or not, should come with financial literacy.

“You can’t really be a true Web3 user if you don’t have at least a certain level of financial literacy that goes above and beyond having a bank account,” Siu said.

*Gamers in Saudi Arabia. Source: Allcorrect game content studio*

The Animoca co-founder claimed that most Web2 users are not capital investors because they’re mostly labor people compared to Web3 people who understand investing.

“What we found is that the path to Web3 mass adoption isn’t giving [Web2 users] just a wallet. That’s actually the easiest part. The harder part is how to make them aware that what they now have is an asset that has potential value, and it could do things and has different network effects that need to be maintained as real value.”

Meanwhile, Mythical Games CEO John Linden told Cointelegraph that he already sees Web3 adoption in the gaming sector, albeit at a slower pace.

“I think we’re seeing some [adoption] already. We’re seeing people that they’re introducing the [Web3] concept. They do understand the concept of buying and selling assets,” Linden said.

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The gaming industry veteran pointed out that Web3 should enhance user experience and not just give them the means to generate income:

“[Web3 gaming developers] have to focus on new game models. When you start doing that, it introduces creator economy, digital supply chain, ownership of guilds and the ability to come up with your own theory within the game itself.”

“Those are principles I think gamers will attach to,” Linden added.

The Mythical Games CEO projects that the Web3 gaming segment could onboard 50 to 100 million players in the next two years, with their own titles targeting 10 million by the end of 2023.

US regulators deny blocking AI chip exports to Middle East

September 1, 2023 Coin Telegraph

China

The U.S. Department of Commerce denied blocking AI chip sales to the Middle East and remained silent about whether the requirements were only imposed on specific countries.

The United States Department of Commerce said on Aug. 31 that the Biden administration has “not blocked chip sales to the Middle East,” according to a report from Reuters.

This comes after disclosures were revealed in a Nvidia report that the U.S. government had expanded requirements for export licenses for artificial intelligence (AI) chips.

Advanced Micro Devices (AMD), a direct competitor of Nvidia, also received a similar letter from regulators.

The Commerce Department made no comment as to whether the requirements were imposed on specific U.S. companies. However, the new rules would require Nvidia and AMD to obtain licenses prior to selling flagship chips to “some Middle Eastern countries,” according to the filing.

Neither of the two companies has revealed if they have applied for said licenses or if there was any feedback on licensing for that region.

The company warned regulators in the quarterly report that being “effectively excluded from all or part of China” could potentially “harm” long-term results for the company.

In October 2022, the Biden administration issued the initial export controls in an effort to slow China from developing high-level AI systems with powerful semiconductor chips made by U.S. companies.

Officials in Washington said they are considering tightening the aforementioned regulations even more in a statement made on June 29, which would further limit the computing power on chips available in the Chinese market.

The moves made by the U.S. government have been under close watch from other regulators around the world. Shortly after the U.S.’s initial regulations came into effect, an agreement was made with the Netherlands and Japan to restrict exports of semiconductor manufacturing equipment to China.

Officials in the United Kingdom, France and Germany have all openly said they are considering screening Chinese foreign direct investment in crucial sectors such as AI.

China has responded by saying it will control the export of gallium and germanium products, the primary raw materials needed to produce AI chips.

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Binance Discontinues Mastercard-Backed Crypto Card in Latin America and Middle East As Legal Challenges Mount

August 25, 2023 The Daily Hodl

Oman launches $350M crypto mining center: Report

August 22, 2023 Coin Telegraph

Oman launches 0M crypto mining center: Report

Bitcoin mining

The mining facility comes as part of a plan to accelerate the digitalization of Oman’s economy, which is mainly dependent on oil exports.

The Sultanate of Oman has launched a new cryptocurrency mining center, the second mining facility to open in the country in the past 10 months.

According to a local publication, the Oman Daily Observer, a data hosting and cryptocurrency mining center, was opened in the Salalah Free Zone, which is a special economic zone in the country with low corporate taxes. A local company, Exahertz, will run the center in cooperation with Dubai-headquartered blockchain company Moonwalk Systems.

The center reportedly cost 135 million Omani rials (roughly $350 million) to construct, and it will use the latest hardware from Bitmain Technologies, with plans to set up 15,000 machines by October 2023. Currently, it operates in a pilot regime with 2,000 machines online, working from 11 megawatts of consumed power, according to the report.

The mining facility comes as part of a plan to accelerate the digitalization of Oman’s economy, which is mainly dependent on oil exports. Another mining center opened in November 2022, costing 150 million Omani rials ($389 million). In 2022, the electricity prices for business operators in the country stood at 0.064 rials ($0.166) per kilowatt hour.

On July 27, the government of Oman launched a consultation paper on a national crypto framework. The framework might require digital asset providers to establish a local office in Oman. It could also oblige them to hold a smaller fraction of assets in hot wallets, conduct audits of safeguarded assets and show proof of reserves.

Cointelegraph contacted the Omani Ministry of Transport, Communication and Information Technology and the Public Authority for Special Economic Zones and Free Zones but didn’t receive a response by publication.

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Abu Dhabi grants virtual asset firm M2 permission to offer crypto services

August 16, 2023 Coin Telegraph

abu dhabi

M2 platform will launch later in 2023, allowing UAE-based retail and institutional clients to buy, sell and custody virtual assets.

The Financial Services Regulatory Authority (FSRA) of the Abu Dhabi Global Market (ADGM) has granted financial services permission (FSP) to virtual assets firm M2 to operate a multilateral trading facility from the United Arab Emirates capital.

In an Aug. 16 announcement, the Abu Dhabi-headquartered M2 said the regulatory approval would allow institutional and retail clients in the UAE to “buy, sell and custody virtual assets,” such as Bitcoin (BTC) and Ethereum (ETH).

The M2 platform, which is scheduled to launch later in 2023, has been developed over the past year with a long-term vision to establish “the highest levels of trust, security and integrity in the emerging virtual asset class,” the announcement said.

Once live, the M2 platform will also allow UAE users to buy cryptocurrencies using fiat money, as well as access to derivatives and yield services.

“The process of obtaining the license is the first step on our journey, and we will remain in close dialogue with ADGM to ensure transparency around the custody of client assets,” said Stefan Kimmil, chief executive of M2.

منصة تداول الأصول الافتراضية "#إم_تو" تحصل على تصريح الخدمات المالية من سلطة تنظيم الخدمات المالية في #سوق_أبوظبي_العالمي ما سيتيح لها إدارة منشأة تداول ديناميكية جامعة، وتقديم خدمات حفظ آمنة للأصول الافتراضية لسكان دولة #الإمارات، وخدمة العملاء من أفراد ومؤسسات.

اعرف المزيد… pic.twitter.com/V984QDdG70
— Abu Dhabi Global Market (@ADGlobalMarket) August 16, 2023

Cointelegraph reached out to M2 for further comments but didn’t receive an immediate response.

“Over the past five years, the ADGM regulatory framework has established clear rules for those operating in the virtual assets sector, and M2 will uphold the highest standards to reflect their vision as the UAE continues to affirm its reputation as a global leader in this space,” he added.

ADGM had not yet responded to Cointelegraph’s request for comment at the time of publication.

ADGM introduced a comprehensive virtual asset regulatory framework in 2018. It has since attracted a number of major companies dealing with cryptocurrencies to set up businesses in its regulated financial economic zone.

“At ADGM, our mission has always been centered around unlocking new growth opportunities and fostering investments in the virtual asset sector, ADGM Authority CEO Salem Al Darei said. “We remain committed to enhancing Abu Dhabi’s digital asset landscape and actively supporting the diversification of our thriving economy.”

In November 2022, the ADGM awarded cryptocurrency exchange Binance an FSP after being granted in-principle approval from the financial watchdog in April.

Subsequently, cryptocurrency exchange Rain received similar regulatory permission in July this year to operate virtual assets brokerage and custody services to UAE users.

Oman financial regulator seeks feedback on proposed virtual asset framework

August 4, 2023 Coin Telegraph

Coin Telegraph

Although the proposed virtual asset regulatory framework in Oman covers FATF-defined assets, the issuance of privacy coins might get banned.

The Sultanate of Oman is inching closer to launching its own virtual asset regulations, with its financial markets regulator seeking public comments on its proposed regulatory framework governing digital assets, such as cryptocurrencies.

The Capital Market Authority of Oman is currently in the process of drafting a comprehensive regime for the virtual asset sector, which includes various business requirements and market abuse prevention, it said in the consultation paper published on July 27.

“The CMA is seeking to provide an alternative financing and investment platform for issuers and investors while mitigating the risks associated with the [virtual asset] class.”

The consultation paper includes 26 questions, with which industry stakeholders could provide their opinion. It includes proposals on regulatory and licensing requirements for virtual asset service providers (VASPs), corporate governance, risk management and virtual asset issuance.

It revealed that the proposed framework encompasses utility tokens, security tokens, fiat-backed and asset-backed stablecoins, and other digital currencies that fall under the Financial Action Task Force’s definition of virtual assets. However, the issuance of privacy coins might get banned, pending public feedback.

The CMA might also require VASPs to establish a local presence in Oman through a legally established entity and physical office and impose minimum capital requirements on them. If finalized, virtual asset firms might also be required to hold only a low percentage of assets in hot wallets, conduct audits of safeguarded assets and show proof of reserves.

The public must submit their feedback to the consultation paper by Aug. 17, with key opinions potentially getting posted on the CMA website.

Following the consultation phase of the development of the virtual asset regime, the CMA will draft and finalize the regulatory framework.

Although the CMA publicly announced launching a regulatory framework on Feb. 14, discussions on regulating the virtual asset industry in Oman began much earlier. In November 2020, the country’s National Committee for Combating Money Laundering and Terrorist Financing decided to launch a task force comprising CMA and Central Bank of Oman officials to study whether to ban or permit virtual asset activities. Consultants were then enlisted in December 2022 to assist in setting up the new regime.

Nomura’s crypto arm Laser Digital bags Dubai VARA license

August 1, 2023 Coin Telegraph

Coin Telegraph

Laser Digital said it would also launch trading and asset management operations in the coming months, including over-the-counter (OTC) service.

The crypto arm of Nomura has obtained an operating license from Dubai’s Virtual Asset Regulatory Authority (VARA) amid the Japanese financial holding’s attempts to leave its mark in the digital asset space.

Laser Digital Middle East FZE, Nomura’s Dubai-based digital asset subsidiary, announced on Aug. 1 that the new virtual asset service provider (VASP) license would allow it to offer broker-dealer and virtual asset management and investment services in the emirate.

Additionally, the permit allows the firm to conduct trading and asset management operations in the coming months, including over-the-counter (OTC) services and a “range of digital asset investment products and solutions,” the announcement said.

“VARA’s thorough and consultative process provides institutional investors with the assurance they require to engage in this asset class, said Jez Mohideen, chief executive of Laser Digital. “With the license now in place, we are looking forward to Laser’s growth over the coming years.”

Laser Digital and VARA haven’t responded to Cointelegraph’s request for further comments at press time.

Founded in September 2022 by Nomura, Laser Digital was the brainchild of Steven Ashley, the former head of Nomura's wholesale division, along with Mohideen, who served as the holding’s former chief digital officer and co-head of global markets for Europe, Middle East and Africa. It’s headquartered in Switzerland and has offices in Dubai and London.

Dubai’s growing crypto ecosystem has attracted global attention, having established its own virtual assets rules and regulatory body in March 2022. In February, the emirate’s virtual asset regulator issued its “Full Market Product Regulations,” which include four compulsory rulebooks and activity-specific rulebooks that lay down the rules for VASPS.

Laser Digital’s new license comes on the heels of Binance reaching another milestone in cementing its foothold in the United Arab Emirates. On July 31, Binance’s Dubai subsidiary, Binance FZE, obtained an operational minimum viable product (MVP) from VARA to operate cryptocurrency exchange and virtual asset broker-dealer services locally.

Aside from Binance, digital asset custodians Komainu MEA and Hex Trust MENA FZE are the only holders of operational MVP permits. Crypto exchange BitOasis, which also secured the same conditional license, had its permit suspended by VARA for not meeting mandated conditions.

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How gaming can spur Web3 adoption

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