Dubai Welcomes Crypto Derivatives Exchange Deribit with License

Deribit, a powerhouse in crypto derivatives trading, has achieved a milestone by obtaining a conditional license from the Virtual Asset Regulatory Authority of Dubai.

This achievement represents a crucial step forward in their quest for a strong presence within the fast expanding the Middle East’s crypto landscape.

The timing of this achievement aligns with Deribit’s strategic decision to move its global headquarters to Dubai, allowing the exchange to tap into the region’s thriving crypto ecosystem.

Crypto Exchange Deribit establishes itself in the UAE

At the same time, the appointment of Luuk Strijers, previously Chief Commercial Officer, to the role of CEO further underlines Deribit’s efforts to identify new growth opportunities within this dynamic sector.

The conditional Virtual Asset Service Provider (VASP) license allows Deribit FZE, the Dubai entity of Deribit Group, to offer both spot and derivatives trading.

However, full exploitation depends on Deribit meeting specific requirements of the VARA. This conditional nature highlights Dubai’s commitment to promoting a secure and regulated crypto ecosystem while remaining open to innovation.

In a statement, Luuk Strijers said:

“VARA’s progressive regulatory framework opens up enormous opportunities in the digital assets space. Our strong position in the crypto options market reflects the trust our customers have in us.”

Although Deribit positions itself as a pioneer in the derivatives market in Dubai, its initial focus appears to be on institutional and qualified investors. This strategic choice could be due to stricter regulations surrounding private participation in Dubai’s digital currency market. However, Deribit ensures continued support for retail investors through its existing Panama-based subsidiary.

Total crypto market cap at $2.4 trillion on the daily chart:

Deribit’s move to Dubai is part of a larger trend of major companies seeking a foothold in the region. The establishment in Dubai of VARA in March 2022, the world’s first dedicated crypto regulator, has built confidence in the market and streamlined regulation.

Dubai as a global crypto hub

This, coupled with Dubai’s ambition to become a global crypto hub, has attracted established players such as Binance, Bybit and OKX. The city is on the rise Blockchain life forum in April further underlines its commitment to fostering a vibrant crypto community.

Deribit’s entry into Dubai offers exciting opportunities for both the company and the region. The license provides Deribit with a gateway to a new and potentially lucrative market, while Dubai benefits from the expertise and established user base that a prominent crypto player brings.

However, uncertainties remain regarding the specific terms attached to the license and how Deribit will manage catering to different investor segments under potentially divergent regulatory environments.

As Deribit meets the remaining requirements and digital currency regulations in Dubai continue to take shape, the coming months will be crucial in determining the ultimate success of this strategic move.

Featured image by Ethan Wilkinson/Pexels, chart from TradingView

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