Gemini Applies for Crypto Licensing in The UAE
The Gemini exchange announced that they have applied for a crypto license to begin servicing customers in the United Arab Emirates. The move was determined after the company analyzed data from their Global State of Crypto Report in 2022 that showed a growing number of users in the Gulf.
Going to the Gulf
The UAE is becoming a popular destination for many web3 businesses for other reasons that may suggest more underlying motives. Dubai is infamously known as a location that does not have an extradition process with the United States. This has led to many web3 founders and businesses moving to the country in order to escape legal action.
While this does not imply that Gemini is doing anything wrong, it continues to show that many companies are starting to take the UAE more seriously as a place to set up shop because laws in the United States about cryptocurrency are not clear yet and SEC chairman Gary Gensler is not making the situation any easier by refusing to answer if web3 companies are following basic laws.
American politics and crypto
Companies like Coinbase have received bizarre backlash from the SEC when they were served a Wells Notice earlier this year. Coinbase replied vehemently to this notice, demanding to know what laws they had broken, stating that the SEC had been uncooperative. This issue has yet to be resolved and, as such, Coinbase announced that they were considering a move to the United Arab Emirates because of Gensler’s actions.
Instead of escaping legal repercussions for a matter that has not been revealed to the public yet, it seems that Gemini is simply exploring alternatives to the United States in case the nation continues its anti-crypto rhetoric which has become public enemy #1 for politicians like Senator Elizabeth Warren and President Biden.
Gemini, an American-based company, may simply be on the lookout for an alternative place to headquarters themselves if crypto laws and regulations become too suffocating in the United States. Although an outright ban is unlikely, calls for crypto to be made illegal have been made which would be detrimental to companies like Gemini.
Criminals like the UAE too
However, there is still an elephant in the room if companies were to flee to the UAE. After FTX’s collapse, Caroline Ellison made headlines as she attempted to fly to the country and avoid law enforcement. Do Kwon was also caught trying to enter the country when he was arrested in Montenegro earlier this year.
Despite legitimate concerns from Coinbase and their reason to look into the UAE with more interest, Dubai is quickly looking like a safe haven for web3 criminals and would make any future discourse about cryptocurrency in the United States much more difficult.
It could also tamper with the web3 ecosystem as well if legitimate companies like Coinbase or Gemini began associating with web3 fraudsters already living in the UAE. This could cause a slow change in company culture or a massive event where we see legitimate web3 development and obvious crypto scams clash with ordinary investors becoming the largest victims.
