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A cryptocurrency mortgage specialist is looking to expand into the United Arab Emirates, marking the latest niche player looking to set up shop there.
Northstake told Blockworks that the company has received preliminary approval from Dubai’s Virtual Asset Regulatory Authority (VARA), which is the first step in obtaining virtual asset service provider (VASP) authorization.
Such a license would allow the Denmark-based company to offer cryptocurrency custody services, such as custodial staking, to institutional investors in the emirate. It ultimately seeks to use the UAE as a “strategic base” to investigate expansion options.
Jesper Johansen, CEO of Northstake, said that the UAE “is becoming a global leader in the field of virtual assets.” Cryptocurrency companies have seen an uptick in interest in Dubai after the emirate established VARA in March 2022 – a regime that industry executives say has spurred innovation in the field.
read more: Dubai is latest government to introduce crypto laws and set up regulators
“We aim to contribute to the development of the UAE crypto ecosystem, leveraging our expertise and innovative solutions in digital asset investment to support financial institutions in the region and our local partners in developing innovative digital asset products, ” Johansen told Blockworks.
According to a September Chainaanalysis report, institutional investments (worth more than $1 million) accounted for approximately two-thirds of cryptocurrency transactions in the UAE between July 2022 and June 2023.
“This market confidence is a testament to the country’s leadership’s efforts to provide laudable regulatory clarity and establish the country as a global cryptocurrency hub,” Chainaanalysis’ research director Kim Grauer said in a statement at the time.
Northstake is the latest cryptocurrency company to enter the region.
Cryptocurrency custody company Komainu was one of the first companies to receive a full VASP license in August, although many companies have tried to provide services there.
In the same month, Laser Digital, the cryptocurrency arm of Japan’s Nomura Bank, received full cryptocurrency authorization from Dubai VARA. At the same time, M2 Exchange also gained the ability to provide custody and multilateral trading services to UAE residents.
Nearly a year ago, Northstake raised about $3 million to support its staking product for institutions. The company, which has a multi-chain platform comprised of yield-generating products, partnered with Coinify in August to serve the company’s institutional and high-net-worth clients.
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