FTX’s collapse did not affect Dubai’s economy, says DET Chief Helal Al Marri

Abu Dhabi: Cryptocurrency exchange platform FTX’s collapse did not impact Dubai’s economy, the Emirate’s Department of Economy and Tourism (DET) Chief said Thursday.

“Regarding GDP impact, it (cryptocurrencies) is relatively small. It’s one of the several new sectors we are looking at,” Helal Saeed Al Marri, Director General of Dubai’s Department of Economy and Tourism, said at Investopia. “When we first developed our virtual asset regulator, we established regulation quite quickly, allowing companies to reach the MVP stage. So they couldn’t be fully operational, but they could go beyond having a sandbox.”

However, Dubai now has a full-fledged regulation in place for virtual assets. “Initially, when we met companies like FTX, we were, of course, none the wiser about how it would turn out. But we did know that we worked very closely with the industry to put in a set of regulations that ensured people had to go through a very rigorous process to operationalize in Dubai and the UAE,” said the DET chief.

And luckily, that was in place because FTX didn’t get to operate in the UAE. “And it didn’t have any impact on the economy here as a result,” added Al Marri.

FTX Trading was enveloped in a global scandal and filed for bankruptcy before it had a chance to gain a foothold in the region late last year. The exchange was founded in 2019 by Sam Bankman-Fried and Gary Wang and, at its peak in July 2021, had over one million users and was the third-largest cryptocurrency exchange by volume.

Dubai’s IPO pipeline

Without naming the companies, Al Marri also said Dubai is ready for more IPO listings from state-owned and private enterprises, driven partly by the recently launched Dubai Economic Agenda (D33) goals.

Al Marri said that the initiative puts in place key priorities and rallies all private and public sector around. “The partnership between the private and public sector will allow us to move forward across areas such as talent, and ESG in addition to the key sectors such as the financial sector, manufacturing, technology, and many others.”

Dubai tourism after China reopening

Al-Marri said Dubai’s tourism strategy had gained considerably from relying on something other than specific countries for growing its visitor numbers.

“Tourism in the UAE is route-focused. We learnt quite a long time ago not to rely on specific countries and tried to use the airlift. We have to develop a diversified strategy.” He said that the Chinese have started returning, however, the DET director-general expects total recovery post-pandemic in six to 12 months as it takes about that long for the aviation network from China to operate again fully. “Until that’s resolved, you’ll always have supply pressures. We’re looking at numbers normalizing by the Chinese New Year next year,” said Al Marri.