ABU DHABI - The UAE, Japan and Singapore have emerged as the trendsetters in regulating the crypto-currency market effectively, according to a top European academic.
"As crypto assets are moving into the mainstream, over the past year their value has exploded and with a number of ambitious initiatives taking place across Asia and the Gulf, digital assets are becoming a financial force to be reckoned with," said Guy Burton, an Adjunct Professor at the Brussels School of Governance, where he teaches politics and international relations.
In an article titled "Getting it right on crypto regulation", published on BrusselsReport.eu, a website featuring news and analysis covering European Union policy, Eurozone affairs and Investment, he pointed out that in the UAE, the Dubai Financial Services Authority explicitly included a crypto regulatory framework in its 2021 business plan.
"Since the start of the year the country has begun to put it into action. The UAE has adopted elaborate regulation as well as established a dedicated regulatory body. The country has already issued licences for more than 30 exchanges to be set up. That, along with officially sanctioned crypto mining, should mean that the country’s share of the global crypto market should grow more than the $26 billion from last year," Burton explained.
By pushing ahead to promote cryptocurrencies and ensure official oversight, the UAE puts it ahead of other countries and jurisdictions, who will be keen to see what effect the recent changes will have, the professor said.
He mentioned that while Singapore or the UAE lack the EU’s size, they have another advantage: they can be fleet of foot. Countries like the UAE have a comparative advantage over some other jurisdictions that are just starting their regulation journey.
The UAE has moved past the stage of appealing for existing authorities to work together. Unlike the EU, it does not have years to wait before the legal framework is fully in place, Burton noted.
"With measures already in place, the Emirati authorities are able to see what will work and what does not – and giving it the chance to respond in a timely and effective fashion. In sum then, it is very likely that plenty of eyes will be on such trendsetters as Singapore and the UAE in the next few years as the digital assets market solidifies its role in the future of finance," the academic stated.