Oman Progresses on Virtual Asset Regulatory Framework

• The Capital Market Authority of Oman released a consultation document on July 27.
• The deadline for comments on the consultation document has been set to August 17.

With its financial markets regulator soliciting public views on its proposed regulatory framework controlling digital assets, such as cryptocurrency. The Sultanate of Oman is moving closer to adopting its own virtual asset rules.

Based on feedback from the public, the Capital Market Authority (CMA) of Oman released a consultation document on July 27. Thus, outlining its plans to create a complete regulation for the virtual asset industry.

Stringent Compliance

The consultation document has 26 questions to solicit feedback from relevant parties. There are suggestions on how VASPs should be regulated and licensed. Also, how to handle corporate governance and risk, and issue virtual assets.

It showed that the proposed framework includes all digital currencies that fit the Financial Action Task Force’s (FATF) definition of virtual assets. However, public opinion might lead to a prohibition on the distribution of privacy coins.

The CMA might also impose minimum capital requirements on VASPs. And demand that they set up business in Oman with a legally recognized corporation and a physical office. If adopted, the regulations might also mandate that virtual asset businesses keep a small fraction of their holdings in “hot wallets,” perform audits and provide evidence of reserves.

The deadline for comments on the consultation document has been set to August 17, and the CMA may publish selected comments on its website.

The CMA will design and approve the regulatory framework when the consultation phase of developing the virtual asset regime has concluded. Discussions on how to regulate the virtual asset sector in Oman started well before the CMA’s February announcement that it would be creating a regulatory framework.

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