Komainu, a Japanese digital asset custodian, has disclosed its ambitions to set up an outpost in Dubai. The firm is one step closer to achieving its dreams of entering the United Arab Emirates (UAE) market after obtaining provisional regulatory approval.
The approval was issued by Dubai’s Virtual Assets Regulatory Authority (VARA), a body created in March to regulate the activities of digital currency firms in the region. Komainu claims that it will not be resting on its laurels and will complete the process to gain a full license from the regulator.
Gaining full approval from VARA involves intense regulatory scrutiny and high-level compliance with the anti-money laundering (AML) rules and Know Your Customer (KYC) processes.
“Komainu actively works with regulators, partners, and our clients to make sure that our platform is held to the highest of standards, and this latest endorsement by the Dubai Government is a further testament to that fact,” said Sebastian Widmann, Koimanu’s head of strategy. He added an expansion into the Middle East will allow institutions to take advantage of the firm’s unique custody offering.
Widmann told reporters that Komainu would increase its staff in Dubai to ten as it looks to expand internationally from its headquarters in the Channel Islands. The custody service providers will be eyeing a wide range of clients, including fund managers and local exchanges in the North African and Middle Eastern regions.
The firm will also seize the opportunity to introduce a new product called Komainu Yield. The offering will allow institutions using the platform for their storage needs to earn yield passively.
Komainu was founded in 2018 by the trio of Japanese banking conglomerate Nomura, Coinshares, and Ledger. Since then, the company has steadily amassed a growing base of customers thanks to its combination of a regulatory compliant and client-focused model.
Dubai becoming the digital currency capital of the world
Dubai has attracted the leading digital currency firms worldwide to its shores. The firms are drawn by the allure of a positive government stance on digital currencies and the gateway to African and Asian markets.
Binance, FTX, and Crypto.com are some of the digital currency exchanges to have gained full approval from the region’s regulator. Other firms like Hex Trust and OKX have disclosed detailed plans to set up shop in the UAE to give the pioneers a run for their money.
The regulatory terrain in Singapore, Indonesia, and China has forced several digital asset firms to look out for other jurisdictions. The Bahamas is one of such jurisdictions challenging Dubai for the top spot.
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