UAE – Regulatory Framework For Stored Values and Electronic Payment Systems

United Arab Emirates (UAE) published the Regulatory Framework For Stored Values and Electronic Payment Systems.

The rules about Virtual Currency are awesome:

Glossary:

Virtual currency means any type of digital unit used as a medium of exchange, a unit of account, or a form of stored value.
Virtual Currency (s) is not recognised by this REGULATION.
Exceptions are made to a digital unit that:
a) can be redeemed for goods, services, and discounts as part of a user loyalty or rewards program with the Issuer and;
b) cannot be converted into a fiat /virtual currency.

The draft enacts a very simple rule:

D.7.3. Provisions for Virtual Currencies.
All Virtual Currencies (and any transactions thereof) are prohibited.

I hope that UAE Central Bank could re-consider this approach that will exclude this innovative State from FinTech Revolution, even if it is questionable if this Regulatory Framework falls only on regulated entities.

http://www.centralbank.ae/en/pdf/notices/Regulatory-Framework-For-Stored-Values-And-Electronic-Payment-Systems-En.pdf

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