Oman announces upcoming launch of Virtual asset regulatory framework

The Oman Capital Market Authority has announced that it will  establish the Virtual Assets Regulatory Framework to regulate and develop the market in the Sultanate of Oman.

The Capital Market Authority (CMA), which regulates and develops the Sultanate's financial markets for the capital market and insurance sectors, is planning to establish the new proposed regulatory framework for Virtual Assets (VA) and Virtual Asset Service Providers (VASP). 

As per the press release, this move highlights the Sultanate’s growing recognition and the CMA's proactive approach to develop the digital assets and fintech industry in Oman.

This important initiative in Oman was announced during a public stakeholders engagement session held at the CMA recently and being led by the CMA. By regulating and developing the virtual assets industry, the CMA aims to provide an alternative financing and investment platform for issuers and investors, while mitigating the risks associated with this asset class.

The CMA is in the process of defining a comprehensive and facilitative regulatory framework, which will include a new regulation to cover all virtual assets activities, a licensing framework for all VASP categories and a supervisory framework to identify, assess, and mitigate ongoing risks. The aim of this new regulation is to establish a market regime for virtual assets that includes rules to prevent market abuse, including through surveillance and enforcement mechanisms.

The proposed new regulatory framework is envisaged to cover activities such as crypto assets, tokens, crypto exchanges, and initial coin offerings, among others. The regulation for virtual assets in Oman is important, as it will provide a clear and secure framework for the growth of the virtual assets industry. The move towards digitalization and the adoption of virtual assets aligns with the Sultanate's Vision 2040 of a digitally transformed economy and financial sector, while attracting foreign investments into Oman.

The CMA has also appointed XReg Consulting Limited, an international policy and regulatory consultancy specializing in virtual assets, and Said Al-Shahry and Partners, Advocates & Legal Consultants (SASLO), an Omani law firm, to advise and assist the CMA. This collaboration brings together expertise in policy, law and technology to assist in the creation of a comprehensive regulatory framework for virtual assets in Oman.

Back in  June 2022 Oman Capital Market Authority  issued its new Securities Law (46/2022) which  stipulates that the authority can “Agree to application of technologies, virtual digital investments or any products or services in the areas related to the provisions of this law, as set out in the Regulation.”

Oman was only one of the first countries in the region to allow crypto mining , mining its first Bitcoin in December 2022.    While The Oman Water and Waste Water Services Company ( OWWSC), member of Nama Group, trialed a stablecoin linked to the Oman Riyal. The company signed an MOU with Oman based Digital Digits, the creators of Easy coins and Connected Chains to trial “ Hasalah” a stablecoin Wallet.