Summary:
- The Central Bank of the United Arab Emirates published rules for businesses and institutions interacting with cryptocurrencies and digital assets.
- The UAE’s new guidance will oversee anti-money laundering and counter-terrorism financing checks in compliance with the Financial Action Task Force (FATF) international standards.
- Policymakers from the UAE and Hong Kong are working together on developing digital asset laws as both regions move to establish themselves as global crypto hubs.
On May 31, the United Arab Emirates (UAE) Central Bank announced new guidance for anti-money laundering (AML) and counter-terrorism financing (CTF) set to take effect next month, per Reuters.
New rules from the apex bank come amid a push from the Emirates toward attracting crypto businesses looking to expand and tap new markets. Local policymakers also met with companies like Coinbase to discuss regulatory matters.
According to a statement on Wednesday, the new guidance treats the risks associated with handling cryptocurrencies and digital assets like NFTs. The framework will provide needed oversight for institutions when doing business with digital asset service providers like exchanges. Customer and counterparty relationships will also fall under the purview of the newly issued guidance.
The new guidance related to the virtual assets sector contributes to strengthening the supervisory and regulatory frameworks of the Central Bank to combat money laundering and the financing of terrorism.
– Governor of the CBUAE, Khaled Mohamed Balama.
Governor Balam further remarked that the new rules will align the Emirati’s policies with international standards set by the Financial Action Task Force (FATF). The FATF listed the UAE in its “grey list” of areas that needed to upgrade their AML and CTF systems back in March 2022.
Hong Kong And UAE Policymakers Discuss Crypto Rules
Authorities from the UAE and Hong Kong are reportedly working together to develop crypto standards needed to protect investors and entice crypto businesses to set up shops in their regions.
The central banks of Hong Kong and UAE recently met in Abu Dhabi to discuss this joint effort. Bank of China, Citi, HSBC, and Standard Chartered spoke for Hong Kong while First Abu Dhabi Bank, Abu Dhabi Islamic Bank, and Emirates NBD represented the Emirati Kingdom.
Cross-border trade and tapping Hong Kong’s burgeoning financial infrastructure were hot-button topics discussed by senior executives from both sides of the aisle.
Both regions have introduced crypto licensing regimes while Dubai, an emerging crypto hub in the Emirates, was the first jurisdiction to establish a body dedicated to digital asset oversight. Hong Kong’s licensing regime is set to come into effect starting June 1 after the city-state ended its long-standing crypto ban.
Crypto stakeholders like Coinbase met with UAE policymakers, hailing the region for its approach to digital assets amid the thickening regulatory atmosphere in the U.S.