Over 65,000 people in Oman own cryptocurrencies in spite of the central bank's cautions against investing in digital assets.
The Capital Market Authority (CMA), which oversees Oman's financial markets, is working to create a new legal framework for the Sultanate's virtual asset market.
The proposed regulations would include oversight of virtual asset operations, a licensing procedure for virtual asset service providers (VASPs), and a framework to detect and reduce risks related to the new asset class, according to a news release from February 14. The statement says:
“The aim of this new regulation is to establish a market regime for virtual assets that include rules to prevent market abuse, including [thorough] surveillance and enforcement mechanisms.”
The proposed guidelines cover a number of virtual asset operations, such as the release of crypto assets, tokens, products and services for cryptocurrency exchanges, and initial coin offerings.
Said Al-Shahry and Partners, Advocates & Legal Consultants (SASLO), an Omani law firm, and XReg Consulting Limited, a virtual assets policy and regulatory consultant, were hired to advise and help CMA write the new legislation.
The proposed regulatory framework, is in line with Oman's Vision 2040 plan, which aims to digitally alter the nation's economy and draw in foreign investors.
Oman wants to establish itself as a pioneer in the Middle East when it comes to the acceptance of virtual assets, but the central bank of the nation seems to be more cautious about cryptocurrencies.
Given the potential for fraud around cryptocurrency, the Central Bank of Oman (CBO) warned citizens to use caution in October.
The CBO has repeatedly issued warnings warning that no firm has yet received a license from it to deal in cryptocurrencies in Oman and that Oman's currency banking rules do not apply to the usage of any digital or virtual currencies.
Omanis continued to hold and invest in the asset despite the warning. Over 65,000 citizens, or 1.9% of the adult population, possess cryptocurrencies in the nation.
25% of residents stated they use digital assets for learning and education, while 62% claimed they have long-term crypto holdings. The remainder claimed to trade cryptocurrency on a daily basis.