The most precious thing in the desert is not water, but the hope for future development. Why the financial industry has become a new growth pole in Dubai, righting the name of encryption assets, pointing out the direction for supervision, and finally becoming the encryption hub in the Middle East. The following content will answer for you.

Why the financial industry has become a new growth pole in Dubai

The most precious thing in the desert is not water, but the hope for future development. With it, on November 24, 2022, the Dubai Virtual Assets Management Bureau also revoked the regulatory license of the afterwave FTX subsidiary, marking the official start of the subsidiary's regulatory license FTX Middle East clearing trip. This month, King'an officially obtained the financial service license from the Abu Dhabi Global Market Financial Services Regulatory Authority, marking its focus on the Middle East market.

Prior to this, many exchanges and asset management institutions have increased the number of Dubai and continued to carry out license acquisition and compliance construction, which is the key to opening the market door in Central and Northeast Africa. As a local resident, the author hopes to introduce to you why the famous emirate and high-tech blockchain come together?

Abu Dhabi is the capital of the United Arab Emirates, and Dubai is just one of them. However, due to its special national organizational structure and Dubai's influence, Dubai has higher exposure and attention. Correcting this cognitive barrier and conveying the objective image of Dubai and the Middle East is the first step to help Chinese Web3 practitioners better enter the Middle East market.

Secondly, Dubai basically does not rely on the oil industry to develop its economy, because more than 80% of the oil reserves and population of the United Arab Emirates are concentrated in Abu Dhabi, and Dubai is only a small oil producing area. Dubai's economic concept is closer to high-end service industry. With the depletion of oil reserves, the oil industry accounts for less than 1% of Dubai's GDP. Due to the special federal system of the United Arab Emirates, the royal families of the seven joined emirates ruled their own territories and divided the number of national leaders such as the hereditary president of Abu Dhabi emirate and the hereditary prime minister of Dubai emirate according to their strength.

Dubai is a highly export-oriented economy, sharing a common destiny with the economy in every move. Since 2020, the epidemic has severely hit Dubai's economy, which is comparable to the economic crisis in 2008. The root cause is that Dubai lacks endogenous power and relies heavily on the outside. It is not enough to rely solely on your own internal circulation.

Two things are worth mentioning. The first is to relax many restrictions on foreign entities entering Dubai. Dubai has long been very attractive to foreign investment. The second point is that Dubai's follow-up to the encryption economy has always been forward-looking. Different from the solidification mode of traditional finance, the encryption economy is in the ascendant, and Dubai has long been concerned about blockchain.

Eight years later, Dubai gradually formed its own ideas under this framework. The development policy of crypto economy can be understood as building a nest to attract phoenix. Dubai is well aware of the globalization characteristics of blockchain, so it continues to attract global companies and talents.

Dubai's view is simple. Encryption economy is the general trend. Instead of waiting for opportunities to be missed, it is better to seize them and rebuild the economic miracle. The Dubai Chief has a famous saying, "No one will remember the second and second", which also applies to Dubai's view on the encryption economy, and to become a first-class encryption economy.

Correct the name of encryption assets and point out the direction for supervision

Compared with the hostility or indifference of many countries to cryptocurrencies, Dubai chose to face crypto assets squarely, because the financial industry is a real economic force that Dubai can rely on in the future, even an irreplaceable trend. Prior to this, Dubai, including the United Arab Emirates, issued crypto asset audit arrangements to supervise cryptocurrency institutions to deal with compliance issues through the Abu Dhabi Global Market Financial License. The full name of ADGM is Abu Dhabi Global Market Financial Free Zone, and its internal financial services regulatory authority issued an ADGM license to allow licensed institutions to provide corresponding financial services in the United Arab Emirates.

In theory, money security applies for an ADGM license to allow it to conduct business in the United Arab Emirates, including Dubai. In addition, the UAE Securities and Commodities Administration also introduced targeted asset CryptoAsset regulation and registration requirements for crypto assets, marking the first step in recognizing crypto assets. Dubai's crypto asset and service consulting activities need to meet two requirements. At present, under the MVP framework, many well-known VARA institutions have issued many licenses, but it is worth noting that the licenses issued at this time are not full licenses for commercial activities, but marks the beginning of supervision, which needs to be distinguished from the legitimacy of commercial activities. However, it should be noted that the DFSA order is only valid within DIFC and cannot be used as a passport for Dubai or the United Arab Emirates to carry out business activities nationwide. Dubai's encryption supervision right will be uniformly attributed to Dubai. VARA maximizes Dubai's potential vitality.

According to Dubai's plan, they will issue their own plan CBDC in the future. As the underlying financial infrastructure, they will fully embrace the crypto economic system. They will continue to increase their investment in Dubai and are very optimistic about Dubai's future prospects on the blockchain. The Dubai government has been promoting the meta universe, encryption technology and other emerging economic growth points, and has launched its own meta universe platform, DEWAverse.

DEWA hopes to provide services to customers and employees on Metaverse. This makes it the first to use it. Metaverse This technology has launched its virtual platform for local government entities. Its regulatory exploration is also in the forefront. The most typical is that VARA was established less than half a year ago, which basically covers the mainstream exchanges, asset management, services and other industry giants. The opening policy has enabled it to attract more overseas talents and companies, becoming the beachfront MENA bridgehead market.

However, Dubai's local talent pool is not optimistic. More than 70% of its population is migrant population, and there is a serious shortage of high-end talents such as information technology. Therefore, it has attracted the settlement of global giants such as currency security, and quickly docked with cryptocurrency. The biggest dilemma is the lack of local users in Dubai. According to the information learned by the author, most exchanges in Dubai do not put the core R&D team and market team here, but gain customers through regional expansion.

ending

To sum up, why does the financial industry become a new growth pole in Dubai? It justifies the name of encryption assets and points out the direction for supervision. The ultimate goal of Dubai is to become an encryption hub in the Middle East. At present, it seems that there is still a long way to go, and it will take a longer time to accumulate. I hope to encrypt oasis in the desert.