Laser Digital opens Dubai's first regulated crypto OTC desk under VARA.
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Nomura’s Laser Digital Pioneers Regulated OTC Crypto Options in Dubai
In a groundbreaking move for the cryptocurrency industry, Laser Digital, the digital asset division of Japan’s investment bank Nomura, has secured a license to operate Dubai’s first regulated over-the-counter (OTC) crypto options desk. This initiative marks a significant milestone in the United Arab Emirates’ efforts to position itself as a global hub for digital asset trading.
Related: Bybit Secures Provisional Crypto License from Dubai’s Virtual Asset Regulator
Regulatory Approval from Dubai’s VARA
Laser Digital’s new venture is authorized under the Virtual Asset Regulatory Authority (VARA) pilot framework, a comprehensive regulatory system introduced by Dubai in early 2023. This “limited license” enables the company to offer OTC crypto options to institutional clients, providing them with the tools necessary for hedging, yield generation, and volatility management. The regulatory framework aims to ensure market readiness and effective risk controls as the sector expands. [Source]
Dubai’s Growing Role in Global Crypto Regulation
Related: Dubai Police Collaborate with Crystal Blockchain to Address Crypto-related Crimes
While the regulation of OTC crypto options is still in its infancy globally, Dubai and the United Kingdom are at the forefront of establishing guidelines. In contrast, the European Union’s approach involves broader financial regulations like MiFID II and EMIR, which address reporting and clearing requirements but lack specific licensing for crypto OTC desks. Similarly, the United States permits some institutional trading of crypto derivatives under existing laws, yet it has not developed a dedicated framework for OTC crypto options. [Source]
UAE’s Ambitions in the Digital Asset Sector
The UAE’s derivatives market, though smaller than that of the US, is experiencing steady growth and diversification. Traditional platforms like the Dubai Gold & Commodities Exchange (DGCX) have long dominated the region’s commodities and FX markets. However, with the introduction of clear regulations for emerging asset classes, the UAE is expanding its focus to include digital assets and institutional financial products. This strategic move is part of a broader effort to attract crypto entrepreneurs and investors to the region. [Source]
Related: Dubai Economic Department Issues Crypto VASP Licenses to BitOasis and CoinDCX Global
Conclusion
As Laser Digital launches its regulated OTC crypto options desk, Dubai continues to enhance its reputation as a leader in digital asset regulation. This development not only strengthens the city’s financial sector but also sets a precedent for other jurisdictions aiming to regulate the burgeoning crypto derivatives market.
Sophia is a pioneer in the world of Web3 and NFT ecosystems. With extensive experience in digital art and tokenomics, she breaks down the intricate relationships between creativity and blockchain technology. Her unique perspective bridges the gap between technology and culture.
