Cryptocurrencies not legalized in the UAE | Push Digits Chartered Accountants

Cryptocurrencies not legalized in the UAE

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Cryptocurrencies not legalized in the UAE

The UAE’s Central Bank (CBUAE) has issued the Stored Value Facilities (SVF) Directive that stated that the system of crypto-currencies has not been legalized.

The CBUAE is also working on releasing the Retail Payment Services Guideline that aims to define the regulatory treatment of crypto-assets.

The CBUAE states that the latest SVF Regulation clarifies and shows clear objection to the rumor that crypto-currency has been legalized in the United Arab Emirates.

Rejecting Crypto-currencies

The CBUAE has claimed that right now, they are not acknowledging virtual assets or crypto assets in the form of a lawful tender within the UAE. So far, the only legally accepted tender is the United Arab Emirates Dirham.

The CBUAE claims that the latest regulation is the SVF Guideline pursues to give licenses to the bodies that provide or issue SVFs within the country. The SVF is an entity that accepts money’s worth or an amount of money in return for keeping the value stored safely.

Since the CBUAE is not identifying crypto-currency as a form of tender, the only way it can be used is by investing in the form of assets.

Payment services

Moreover, the Apex bank says that it is developing a new version of the Retail Payment Services Guideline, which introduces the idea of payment tokens. These are crypto-assets which are supported by a flat currency and are used as a means of payment.

After releasing the latest SVF guideline, The UAE’s Central Bank (CBUAE) pursues to help and support service providers other than banks and FinTech firms’ easier entry to the market while doing their work of safeguarding customer funds. This ensures that proper support and business conduct continues while developing payment services and products.

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