The city of Ras Al Khaimah (RAK), UAE, plans to introduce a free zone for digital and virtual asset companies. The government of Ras Al Khaimah said this free zone will be called RAK Digital Assets Oasis. This announcement was made recently at the Blockchain Life 2023 international forum.
The reason behind the decision is that the UAE wants to invite global crypto businesses to set up shop in Ras Al Khaimah, one of the seven Emirates of the United Arab Emirates (UAE). With this new move, the free zone will enable innovation for unregulated activities in the virtual asset space.
Sheikh Mohammed Al Qasmi, RAK ICC chairman, announced:
We are proud to continue to position the UAE as a leading destination for innovation with the launch of the RAK Digital Assets Oasis. We are building the free zone of the future for the companies of the future. As the world’s first free zone dedicated solely to digital and virtual asset companies, we look forward to supporting the ambitions of entrepreneurs from around the world.
According to reports, this free zone for digital and virtual asset service providers will open for applications in the second quarter of 2023.
What is a Free Zone?
A free zone, or free trade zone, is an economic area where businesses and entrepreneurs will have absolute ownership of their business. This also means that entrepreneurs have the right to have their own tax scheme and regulatory framework; This preferential structure will not, however, include the UAE’s criminal law.
The virtual asset free zone will include digital asset service providers from the non-fungible token (NFT) sector, blockchain, decentralized autonomous organization (DAO), utility tokens, metaverse, and other businesses connected to the crypto/Web3 Ecosystem.
The UAE, in particular, has been very welcoming to the virtual asset industry. It has dedicated resources to invest and develop infrastructure to be conducive to the growth of the digital asset industry. The UAE has also developed policies to help entrepreneurs in this space, as the country seeks to expand its oil-based economy.
This free zone will encourage virtual asset companies using a framework that helps accelerators and incubators in the digital and virtual asset industry. This zone will provide advisory services, sandboxes, and hybrid workspaces. There is also access to funding. RAK Digital Assets Oasis will also support this business-friendly infrastructure by offering progressive policies.
What State Federal Virtual Asset Laws?
The Securities and Commodities Authority (SCA) is the UAE’s main financial regulator. According to the SCA and the latest federal law on virtual assets, the SCA has the authority to regulate industries throughout the Emirates except for financial free zones, including the Abu Dhabi Global Market (ADGM) and Dubai International Finance. Center (DIFC).
ADGM and DIFC have their own sets of financial regulators. In the UAE, the new free zone has added more than 40 multidisciplinary companies, including many new crypto, blockchain, and Web3 companies. These include Dubai Multi Commodities Center (DMCC), DIFC, and ADGM.
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