Dubai’s Financial Authority Advocates for Global Regulatory Cooperation to Thwart Crypto Scams
Dubai's Financial Services Authority (FSA) is urging global financial regulators to enhance their collaboration efforts to prevent the exploitation of cryptocurrency regulatory loopholes. The call comes as the UAE, with its crypto-friendly regulations, continues to attract Bitcoin-related businesses.
In the face of rising cryptocurrency adoption and the associated risks, Dubai’s Financial Services Authority (FSA) has emphasized the need for increased global regulatory cooperation. The FSA, which oversees the enforcement of anti-money laundering (AML) and counter-terrorist financing (CTF) rules in the region, believes that a more unified approach among international financial regulators could help prevent the exploitation of regulatory loopholes by malicious actors in the crypto space.
As cryptocurrencies like Bitcoin (BTC) gradually gain acceptance, with an estimated 420 million users worldwide, the call for regulations that balance consumer protection and the prevention of illicit activities has become more pronounced. Elisabeth Wallace, FSA associate director, voiced this sentiment during a virtual conference on May 26. She stressed the need for regulators across different jurisdictions to enhance their communication and collaboration efforts, thereby making it more challenging for rogue actors to take advantage of gaps in crypto regulations.
Wallace also pointed out that many web3 businesses often push the regulatory envelope by offering a wide range of products and services under one roof. This global nature of operations necessitates more inter-regulatory dialogue to identify and close potential regulatory gaps that could be exploited.
The United Arab Emirates (UAE), thanks to its favorable crypto regulations, has become an attractive destination for Bitcoin-related businesses. In the previous year, Dubai’s Virtual Assets Regulatory Authority (VARA) introduced new rules for crypto businesses, aiming to mitigate risks and create a conducive environment for these businesses to flourish.