The Dubai Digital Asset Regulatory Authority (VARA) has issued a Digital Asset Service Supplier (VASP) license for the Backpack crypto pockets, resulting in the launch of Backpack Alternate.
Backpack’s VARA license is restricted to cryptocurrency trade providers in Dubai and doesn’t permit the corporate to supply different digital asset services. In accordance with the announcement, the Backpack trade integrates zero-knowledge proof of reserves (zk-proofs), multi-party computation (MPC) for custody, and low-latency order execution, amongst different options.
The announcement additionally revealed that the Backpack trade had obtained operational licenses in a number of jurisdictions all over the world over the previous 5 months.
– Backpack (@xNFT_Backpack) October 31, 2023
The flagship Backpack Pockets presently presents itself as an unregulated product; nonetheless, it’s designed to assist customers transition from fiat to on-chain purposes sooner or later. Backpack CEO and co-founder Armani Ferrante has shared his intention to “finish” the opacity of crypto exchanges.
Talking towards the norm of operating full-fledged crypto exchanges with a single level of failure and with out proof of reserves or auditability, Ferrante stated:
“Utilizing cryptographic strategies similar to zk proofs, MPC, and state machine replication, Backpack Alternate hopes to lift the bar for transparency and compliance to display one of the best of this expertise. Do not belief, confirm.
Present Backpack and Mad Lads customers will get first entry to the Backpack trade beginning in November 2023 and can go public in Q1 2024. Throughout this time, Backpack plans so as to add varied buying and selling options similar to derivatives, margins and cross ensures. supply
Backpack has not but responded to Cointelegraph’s request for remark.
Dubai’s VARA regulator has issued various levels of operational licenses to quite a few crypto exchanges over the previous yr, strengthening its place as a crypto-friendly jurisdiction.
The Dubai Digital Belongings and Regulatory Authority has launched the much-anticipated Complete Market Laws for Digital Asset Service Suppliers (VASP).
— Irina ₿. Heaver (@IrinaHeaver) February 7, 2023
In February 2023, the regulator issued new tips for VASPs working within the emirate. All crypto exchanges should adjust to advertising and marketing, promoting and promotion rules. Violators can be fined between 20,000 dirhams ($5,500) and 200,000 dirhams ($55,000), and repeat offenders might face fines of as much as 500,000 dirhams ($135,000).