FILE PHOTO: Representations of cryptocurrencies are seen in this illustration, August 10, 2022. REUTERS/Dado Ruvic/Illustration/File Photo
DUBAI (Reuters) - Middle Eastern crypto exchange Rain said on Tuesday its Abu Dhabi unit obtained a license to operate a virtual assets brokerage and custody service for clients in the United Arab Emirates.
The Bahrain-headquartered Rain, backed by Coinbase, said its entity based in the Abu Dhabi Global Market financial freezone will now offer institutional clients and some retail clients in the UAE the ability to buy, sell and store virtual assets.
Rain will also be able to open a bank account in the UAE, and allow clients in the country to fund their own accounts when using the local payment network, co-founder Yehia Badawy said in an interview on Tuesday.
Local asset managers have been hesitant to work with crypto firms without a domestic licence, he continued, adding they will now feel more comfortable after it obtained regulatory approval.
"We can capture more demand from institutional investors using this licence," he said.
Rain was founded in 2017 by Badawy and three others, and backed by Silicon Valley venture capital firm Kleiner Perkins and Coinbase Ventures.
It raised $110 million last year in a Series B funding round that valued the firm at $500 million. Rain, which has units registered in Bahrain and Turkey, said it would use the proceeds on regional expansion.
The UAE has been trying to attract some of the world's biggest crypto firms. It has been quick to enable payments via crytocurrencies in areas like real estate and school fees, spurring rates of adoption and transaction volumes.
It has also been trying to develop virtual asset regulation to attract new forms of business as economic competition heats up in the Gulf region.
The world's largest exchange, Binance, is based in the country. Another exchange, Gemini, is expected to operate there soon.
(Reporting by Hadeel Al Sayegh; Editing by Emma Rumney)
