Dubai, one of the UAE’s seven emirates and the region’s trade hub, this month issued its first law governing digital assets and formed the Virtual Asset Regulatory Authority (VARA) to oversee the sector.

Dubai this month granted virtual asset licences to Binance, the world’s largest cryptocurrency exchange, and FTX Europe, which will set up a regional headquarters in the city. Global exchanges Bybit and Crypto.com this week said they are also establishing operations there.

BitOasis, which was founded in Dubai in 2015 and serves English and Arabic speaking customers in the Gulf and Middle East, will continue operations in Dubai while it applies for a full VARA license, the company said.

Prior to coming under VARA, BitOasis had been registered with the central bank and was reporting on anti-money laundering issues to the bank’s financial intelligence unit, the company said.

The UAE has been pushing to develop the virtual asset sector and regulation to attract new forms of business as regional economic competition heats up.

Internationally, regulators worry about how a meltdown in cryptoassets – markets which are highly volatile and still opaque – would feed into the wider financial sector and there is a global push to regulate the sector.