Policy • May 31, 2023, 6:46AM EDT 
Quick Take
- The Central Bank of the UAE today issued guidance outlining the risks arising from dealing with virtual assets and VASPs.
- The guidance comes as authorities in the country attempt to lure crypto outfits with a friendly regime.
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The Central Bank of the UAE this morning issued new guidance concerning AML and CFT measures for crypto businesses.
The guidance outlines the risks arising from dealing with so-called virtual asset and virtual asset service providers (VASPs), taking into account the recommendations of the Financial Action Task Force (FATF), the global watchdog. The new rules will come into effect in one month.
The move will affect Licensed Financial Institutions in the United Arab Emirates, including banks, finance companies, exchange houses, payment service providers, registered hawala providers and insurance companies, agents and brokers.
“The new guidance related to the virtual assets sector contribute to strengthening the supervisory and regulatory frameworks of the Central Bank to combat money laundering and the financing of terrorism,” His Excellency Khaled Mohamed Balama, Governor of the CBUAE, said in a written statement.
“We are constantly working to enhance efforts and strengthen the awareness of licensed financial institutions to prevent all kinds of financial crime activities, and reduce potential risks to protect the financial and monetary system and maintain its soundness and stability, in line with the Financial Action Task Force standards.”
The guidance comes with authorities in the UAE doing their utmost to lure crypto businesses to the region — in part through a welcoming regulatory framework. In March, Dubai unveiled a new agency tasked with virtual asset regulation. Several major crypto firms, including Coinbase, have praised the approach taken by regulators in the region.
