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OKX receives ‘preparatory’ license from Dubai’s VARA after Canada exit

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The Middle East subsidiary of OKX has confirmed the receipt of a Minimal Viable Product (MVP) preparatory license as the next step toward setting up operations in the United Arab Emirates (UAE).

In a post on its website, the digital currency exchange said it received the license from the Dubai Virtual Assets Regulatory Authority (VARA), which lays the foundation for OKX to obtain a full-scale license in the coming months to offer residents a suite of digital currency services.

OKX says the receipt of an operational license will see it offer spot, derivatives, and fiat services to retail and institutional investors.

Obtaining the preparatory license was not a walk in the park for OKX, as the exchange had to tick all of VARA’s strict regulatory requirements. OKX also published its proof of reserves for seven consecutive months, signaling an intent to “do things in a measured and transparent manner.”

“Licensing in Dubai is a critical element of OKX’s global regulatory compliance strategy. In today’s uncertain market environment, it’s of the utmost importance for VASPs to be highly secure, transparent, compliant and backed by strong, clear regulation,” Tim Byun, head of government relations at the exchange, said.

To indicate its commitment to Dubai, OKX launched a new office complex in the Dubai World Trade Center while pledging to extend its brand partnerships in the country. The exchange confirmed that it would grow its staff strength in Dubai to 30, focusing on local hires and senior management.

In March, OKX announced its exit from Canada over a tightening regulatory landscape but hinted at a possible return in the future.

“We regret to inform you that, due to new regulations, OKX will no longer provide services or allow users to open new accounts in Canada starting on March 24,” their announcement read.

Dubai is the new Web3 paradise

Lured by clear regulations and government support, global digital currency exchanges are flocking to Dubai to set up offices. Like OKX, Bybit announced the launch of an office complex at the Dubai World Trade Center after receiving approval from VARA.

Since VARA’s creation, Binance, Crypto.com, and even the defunct FTX have made forays into Dubai, stoking concerns over VARA’s guardrails to prevent bad actors. FTX’s collapse in 2022 jolted the regulator to increase its monitoring of service providers to avoid a repeat of the black swan event.

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