Why Dubai Is Winning the Web3 Race: Animoca's License Reveals Bigger Strategy

While regulators in the West tighten their grip on crypto, the Middle East is rolling out the red carpet. Animoca Brands, the venture capital giant managing over 600 blockchain investments, just secured a Virtual Asset Service Provider (VASP) license in Dubai—and it's not alone.

The Regulatory Haven Strategy

Animoca Brands announced Monday it can now offer broker-dealer services and digital asset management in Dubai, thanks to approval from the emirate's Virtual Assets Regulatory Authority (VARA). This follows the Hong Kong-based company's in-principle fund manager approval in Abu Dhabi last November.

Dubai established VARA in 2022 with a clear mission: become the go-to jurisdiction for crypto companies seeking regulatory clarity. Major exchanges like Binance and OKX have already set up shop there, creating a cluster effect that's hard to ignore.

For Animoca, which filed for a Nasdaq listing through a reverse merger late last year, Dubai offers something increasingly rare—a pathway to serve institutional clients without regulatory uncertainty. The company's portfolio includes crypto treasury management and digital asset infrastructure services that institutional investors desperately want but can't easily access in more restrictive jurisdictions.

East vs. West: The Great Regulatory Divide

The timing isn't coincidental. As the European Union's Markets in Crypto-Assets (MiCA) regulation takes full effect in March 2026, crypto companies face a stark choice: comply with increasingly complex Western regulations or migrate to friendlier shores.

Dubai's appeal goes beyond just lighter regulation—it's about economic diversification. The UAE is actively transitioning from an oil-dependent economy to a knowledge-based one, and crypto represents a high-value, low-carbon industry that fits perfectly into this vision.

This creates a fascinating dynamic. While the U.S. debates whether crypto is a security and Europe implements comprehensive but burdensome rules, Dubai is simply asking: "How can we help your business grow?"

The Winners and Losers

Winners: Crypto companies get regulatory certainty, Dubai gets high-paying jobs and tax revenue, and investors gain access to professional-grade services.

Potential Losers: Traditional financial centers risk losing innovative companies, and investors in less regulated jurisdictions might face reduced protection if things go wrong.

The broader question is whether this represents healthy regulatory competition or a dangerous race to the bottom. When FTX collapsed, many investors discovered that offshore incorporation didn't protect them from fraud.

The Institutional Money Factor

Animoca's Dubai move signals something bigger: institutional money is flowing into crypto infrastructure, not just speculative trading. The company's focus on treasury management and digital asset infrastructure suggests that corporations and pension funds are quietly building crypto exposure through professional service providers.

This is different from the retail crypto boom of 2021. It's about building the plumbing for a new financial system—and Dubai wants to be where those pipes are manufactured.