Ras Al Khaimah, one of the United Arab Emirate’s (UAE) seven Emirates, is set to launch the RAK Digital Assets Oasis (RAK DAO), the country’s first free zone dedicated to digital and virtual asset companies. The new free zone will be a “purpose-built, innovation-enabling free zone for non-regulated activities in the virtual assets sector.”
The free zone will be dedicated to digital and virtual assets service providers in emerging technologies, such as the metaverse, blockchain, utility tokens, virtual asset wallets, nonfungible tokens (NFTs), decentralized autonomous organizations (DAOs), decentralized applications (DApps) and other Web3-related businesses.
We are building the free zone of the future for companies of the future. As the world’s first free zone solely dedicated to digital and virtual asset companies, we look forward to supporting the ambitions of entrepreneurs from around the world.Sheikh Mohammed bin Humaid bin Abdullah Al Qasimi, chairman of the RAK International Corporate Centre.
Dubai-based crypto lawyer Irina Heaver noted that the RAK DAO will begin with non-financial activities first, then may introduce financial activities at a later stage. “[Entrepreneurs] won’t be able to launch a crypto exchange just yet, which is an ESCA-regulated financial activity,” she said.
According to the country’s latest federal-level virtual assets law, the Securities and Commodities Authority (SCA) has authority throughout the Emirates, except for the financial free zones — the Abu Dhabi Global Market (ADGM) and Dubai International Financial Centre (DIFC) and others, which have their own financial regulators.The new free zone adds to the more than 40 multidisciplinary free zones in the country that have attracted numerous crypto, blockchain and Web3 firms, including the Dubai Multi Commodities Centre (DMCC), DIFC and the ADGM.
In March 2022, Dubai unveiled its virtual assets law, along with the Virtual Asset Regulatory Authority (VARA), to protect investors and provide standards for the digital asset industry. In September 2022, the Financial Services Regulatory Authority — the regulator of the ADGM — published guiding principles on its approach to regulating and overseeing the new asset class and its service providers. The UAE has painted itself as a forward-thinking hub for crypto firms eyeing jurisdictions with friendlier regulations.