February 19, 2023

Oman Plans To Set up Regulatory Framework for Virtual Assets

Oman Plans To Set up Regulatory Framework for Virtual Assets Featured Image

Oman’s Capital Market Authority (CMA), the regulator and developer of the financial markets, announced a plan to outline a regulatory framework for the virtual assets and virtual asset service providers in the Sultanate.

CMA’s plan came during a public stakeholders engagement session. According to a press release, the authority seeks to offer an alternative financing and investment platform for issuers and investors, while mitigating the risks associated with this asset class.

The regulations of the new plan will include covering all virtual assets activities, offering a licensing framework for all categories of virtual asset service providers, in addition to outlining a supervisory framework to identify, assess, and mitigate ongoing risks in order to establish a market regime for virtual assets that includes rules to prevent market abuse, including through surveillance and enforcement mechanisms.

The new regulatory framework will cover crypto assets, crypto exchanges, tokens, and initial coin offerings, among others in a move that targets providing a clear and secure framework in light of the growing importance of virtual assets in the region, currently and in line with Oman Vision 2040 of a digitally transformed economy and financial sector to lure foreign investments.

CMA started taking steps on the ground to prepare the framework by appointing XReg Consulting Limited, an international policy and regulatory consultancy specializing in virtual assets, and Said Al-Shahry and Partners, Advocates & Legal Consultants (SASLO), an Omani law firm, to benefit from their expertise in expertise in policy, law, and technology to assist the authority in developing a comprehensive framework.

However, the Central Bank of Oman was cautious about cryptocurrencies. In October 2022, the bank called on Omani citizens to be cautious regarding investing in digital assets. According to Cointelegraph, nearly 65,000 residents in the Sultanate hold cryptocurrencies.

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