The government of Ras Al Khaimah is set to unveil a new free zone tailored for digital and virtual asset firms as the United Arab Emirates (UAE) strengthens its position as a magnet for players in the burgeoning blockchain industry.
Known as the RAK Digital Assets Oasis, this bespoke zone will serve as a dedicated, innovation-oriented space for unregulated activities in the virtual assets sphere. The zone is slated to begin accepting applications from Q2 2023, as per an official government statement on Monday.
“We are building the free zone of the future for companies of the future. As the world’s first free zone solely dedicated to digital and virtual asset companies, we look forward to supporting the ambitions of entrepreneurs from around the world.”
The RAK Digital Assets Oasis will exclusively cater to providers of digital and virtual asset services within novel and emerging sectors such as the metaverse, blockchain, utility tokens, virtual asset wallets, non-fungible tokens, decentralized autonomous organizations, decentralized applications, and other Web3-related ventures.
The RAK Digital Assets Oasis will provide a range of support to firms, including adoption frameworks that encourage innovation, expert advisory services, flexible workspaces, accelerators, incubators, sandboxes, and access to funding, the statement said.
The country is proactively offering incentives to entice digital firms to establish operations within its borders. In July, Dr. Thani Al Zeyoudi, the Minister of State for Foreign Trade, announced that the NextGenFDI initiative’s first phase seeks to draw 300 digital firms within six to twelve months.
UAE as an alliance of Free Zones
Free zones, otherwise referred to as free-trade zones, are designated economic districts that offer entrepreneurs complete ownership of their enterprises, as well as access to favourable tax regimes.
The United Arab Emirates has been channeling significant resources towards infrastructure development and policy overhauls aimed at bolstering its appeal to businesses and entrepreneurs, in a bid to expand its non-oil economy.
According to a recent report by the Dubai Chamber of Digital Economy, the UAE’s digital economy is projected to surge to over $140 billion by 2031, up from its current value of approximately $38 billion.
Digital asset industry in Dubai
In March of last year, Dubai implemented the Dubai Virtual Asset Regulation Law, with the aim of establishing a cutting-edge legal framework that safeguards investors and establishes global standards for governance within the virtual asset industry. This law is intended to promote responsible expansion of the sector within the emirates.
Furthermore, it also gave rise to the Virtual Asset Regulatory Authority (Vara), an independent entity tasked with regulating the industry across Dubai’s special development and free zones, with the exception of the Dubai International Financial Centre.
However, the UAE’s central bank, headquartered in the Emirate of Abu Dhabi, does not recognize cryptocurrencies as legal tender.