Ras Al Khaimah, which is one of the seven Emirates of the UAE, plans to establish a free zone for companies dealing with digital and virtual assets. This initiative is expected to draw in more global crypto players, as the UAE has been supportive of the industry.
The RAK Digital Assets Oasis will be specifically designed to facilitate innovation and support non-regulated activities related to virtual assets. The application process for the free zone is set to begin in the second quarter of 2023.
The RAK DAO will be a free zone that specifically caters to providers of digital and virtual asset services in emerging technologies. These include the metaverse, blockchain, utility tokens, virtual asset wallets, non-fungible tokens (NFTs), decentralised autonomous organisations (DAOs), decentralised applications (DApps), and other Web3-related businesses.
The aim of the free zone is to create a space for innovative companies that are at the forefront of the digital and virtual asset industry.
Sheikh Al Qasimi, the chairman of the RAK International Corporate Centre, which operates the free zone, stated that it would be the world's first free zone dedicated solely to digital and virtual asset companies. The free zone intends to support entrepreneurs from all over the world to achieve their ambitions in this exciting and dynamic industry.
Free zones or free-trade zones are designated areas where entrepreneurs can have complete ownership of their businesses and operate under their own tax and regulatory systems, with the exception of the criminal laws of the UAE.
According to a Dubai-based lawyer specialising in crypto, Irina Heaver, the RAK DAO will initially focus on non-financial activities and may introduce financial activities later on.
Heaver suggests that entrepreneurs will not be allowed to start a crypto exchange immediately, as it is a financial activity regulated by the Emirates Securities and Commodities Authority (ESCA).
The Securities and Commodities Authority (SCA) is a major financial regulator in the UAE. According to the latest federal-level law related to virtual assets in the country, the SCA has jurisdiction over all the Emirates, except for the financial free zones like the Dubai International Financial Centre, and the Abu Dhabi Global Market, which have their own financial regulators.
The RAK DAO free zone is a new addition to the over fourty multidisciplinary free zones in the nation that have attracted numerous crypto, blockchain, and Web3 companies. Some of the notable free zones include the Dubai Multi Commodities Centre (DMCC), DIFC, and ADGM.
The writer is the founder at yMedia. He ventured into crypto in 2013 and is an ETH maximalist. Twitter: @bhardwajshash