As crypto is slowly entering the Middle East, Qatar has put a blanket ban on digital asset services, especially trading.
Reported by regional news outlet International Investment, the ban was implemented by the Qatar Financial Center (QFC) Regulatory Authority, which is responsible for authorizing and regulating firms and individuals conducting financial services in or from the QFC.
In its announcement, the independent regulatory body stated that “virtual asset services may not be conducted in or from the QFC at this time.”
The regulator also specified that “anything of value that acts as a substitute for currency, that can be digitally traded or transferred and can be used for payment or investment purposes.”
Although the regulator was clear about trading services, the phrase “virtual asset services” covers a wide range of businesses in the sector, including crypto-to-crypto trading, custody, and investment services involving digital currencies.
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The ban, however, does not cover digitized securities or other financial instruments overseen by the Regulatory Authority, the Qatar Central Bank, or the Qatar Financial Markets Authority.
A major economy against crypto
Though small in size, Qatar has significant influence in the region, mostly because of its rich oil-based economy. With over 2.5 million population, the country has a per capita GDP of more than $63,000, ranking it among the richest nations in the world.
Regulators in many countries are concerned with the crypto economy, but only a handful have completely banned crypto trading or other digital asset-related services, Qatar being the latest. The motive behind the regulator’s decision, however, is not clear yet.
Notably, Qatar’s central bank has always been hostile towards digital assets and, in 2018, stated that Bitcoin trading was illegal in the country, without enforcing any ban.
“This cryptocurrency is highly volatile and can be used for financial crimes and electronic hacking as well as risk loss of value because there are no guarantors or assets,” the central bank said then.