No clients were exposed, according to Dubai regulators, as FTX MENA was still in the planning stages before receiving full operating approval.
The Dubai Virtual Assets Regulatory Authority (VARA) has suspended the license that allows FTX to make plans to serve the local market following the collapse of the crypto exchange giant.
In the announcement, VARA stated on its official website that it had revoked the license for FTX MENA’s Minimum Viable Product (MVP).
VARA confirmed that the license of FTX MENA was suspended prior to any clients being made aware of it, citing the bankruptcy filing of FTX-related companies like FTX exchange and Alameda Research.
The regulator stated that FTX MENA was still in the planning stages. The authority made it clear that the company did not yet have the authorization needed to launch its operations and accept clients.
Furthermore, the regulator also called attention to the fact that the company had not yet opened a domestic bank account, which is necessary for virtual asset service providers to begin doing business in the United Arab Emirates.
In addition, authorities have also requested disclosures from VASPs who collaborated with VARA to take part in the regional virtual asset ecosystem.
The regulator will then be able to evaluate the exposure of the domestic market and the extent of the contagion within the UAE.
Sam Bankman-Fried, the former CEO of FTX, declared in March that FTX had been granted Dubai’s first license for digital assets.
The FTX exchange received authorization to run under the MVP program in July, allowing it to move forward with testing and preparations.
VARA was established on March 9 as a result of a new law that established a legal framework for cryptocurrencies in Dubai.
The regulator’s duties include overseeing industry governance standards creation and investor protection.
Bankman-Fried is still giving a speech at a conference that is being held by The New York Times despite the backlash that the former FTX exchange has brought to the cryptocurrency community.