UAE Regulator Revokes FTX License Amid Exchange Collapse

Dubai regulators noted that no clients were exposed as FTX MENA was still in the preparation stage before being fully approved to operate.

As the FTX debacle continues to create waves in the crypto industry and beyond, the Dubai Virtual Assets Regulatory Authority (VARA) has suspended the license that allows FTX to prepare to serve the local market.

In an announcement posted on its official website, VARA mentioned that it has revoked the Minimum Viable Product License (MVP) approval of FTX MENA. Citing the bankruptcy filing of FTX-related entities including FTX Exchange and Alameda Research, VARA confirmed that FTX MENA's license was suspended before any clients were exposed.

According to the regulator, FTX MENA was still in the preparatory phase. The authority clarified that the company has not yet received the required approval to start operations and onboard customers. Furthermore, the regulator pointed out that the company has not yet obtained a domestic bank account, which is a requirement for virtual asset service providers to start operations in the United Arab Emirates.

The regulator has also asked VASPs that have engaged with VARA to participate in the local virtual asset ecosystem to provide insights. This will allow the regulator to assess domestic market exposure and the extent of contagion in the UAE.

In March, former FTX CEO Sam Bankman-Fried announced that FTX had received the first digital asset license in Dubai. In July, the FTX exchange received the