The crypto industry in the United States has been fighting for better representation and regulatory clarity since the FTX fall-out almost a year ago. A combination of public skepticism, political vilification, talent drain, bear market and a soft economy in the U.S. is making progress an uphill battle. 

The next iteration of the global financial system is being built on crypto rails. Yet the United States continues to fall over itself with zero regulatory clarity. 

Azeem Khan, head of impact at Gitcoin, has been involved in the Stand with Crypto efforts in DC, led by Coinbase. Khan senses regulatory clarity is on the way within the next 18 months, but not because legislators in Washington DC want it. 

“The fact that there is no understanding of who actually oversees crypto has been difficult,” he said to me in a recent interview. “This could mean they set up a new alphabet soup organization,” such as the CFTC or SEC which are currently vying to regulate crypto. “Everyone’s trying to enforce it but there’s no real guidelines. 

Lawmakers aren’t necessarily anti-crypto, he said. “It’s that they are uneducated about crypto. I get the sense there’s not an adept understanding but more so an openness to understand it,” Khan said. “You can’t kill crypto, but you can kill crypto in the United States – and the American dream along with it. 

The U.S. faces competition from other countries such as the United Arab Emirates. 

On October 19, the Middle Eastern country launched the web3 free zone called RAK Digital Assets Oasis (RAKDAO) in the emirate of Ras Al-Khaimah. 

Designed to make the UAE a thriving digital assets technology hub, RAKDAO is hoping to become an  experimental playground for builders and businesses. The current ruler of the Emirate of Ras Al-Khaimah, Sheikh Saud bin Saqr Al Qasimi, opened the RAKDAO event with a positive, progressive take on crypto, and where his vision is focused. He sat in on all the subsequent talks. 

Khan attended the RAKAO event and moderated a panel on the future role of central bank digital currencies, or CBDCs. He’s been regularly visiting the UAE in the past three years and has seen an evolution in the crypto space, particularly Dubai and Abu Dhabi. 

Khan believes there’s a latent xenophobia in the west to overlook what’s going on in the Middle East and Asia. People in the west aren’t paying attention in the ways they should be, he said.

“When you go and interact with people on the ground, you realize if you compound what’s going on over there over the next five or 10 years, this is going to be massive,” Khan said. “There’s no catching up at that point.”

The UAE has established dedicated regulators for digital assets, with the Virtual Assets Regulatory Authority (VARA) in Dubai and Abu Dhabi Global Market (ADGM) in Abu Dhabi. 

Bullish, even in the bear 

For the RAKDAO attendees, no one would have known it was a bear market, with all the yacht parties, funds, private equity and royals in attendance.  

“The UAE sees an opportunity that they can be a global leader in the industry because they’re not behind. There are so many industries where you can’t compete once you’re a number of years behind,” Khan said. 

The UAE is looking to compete with Hong Kong and Singapore as crypto hubs and homes for people to set up companies. There’s no capital gains or income tax for individuals imposed in the UAE. People go there for tax reasons, but RAKAO hopes initiatives such as the Golden Visa, which provides grants to assist with setting up a long-term residence, helps attract more foreigners. 

Read more: Stand With Crypto’s DC Educational and Cultural Campaign Spans the Hideaways of Capitol Hill to Its Happy Hours 

Saudi Arabia is also making strides to solidify its place as a global crypto destination. Prime Minister of Saudi Arabia, Mohammed bin Salam Al Saud (MBS), “wants to make it one of the global hubs of the next generation of tourism, finance, crypto, eSports, and AI,” Khan said. 

A caveat 

Unlike the Silicon Valley of the web2 era, there likely won’t be one centralized spot for crypto. Yet there will be locations that lead the way and capture crypto’s opportunities. 

The finer details of RAKDAO are still being spelled out and there are no concrete initiatives yet to speak of. The RAKDAO event was more of a signal to the world about the UAE’s commitment to crypto – with the promise of progressive legislation, infrastructure, banking and access to funding for digital assets companies. 

The UAE has proven to the world how far, and fast, they can develop culturally, going from camels to fast cars in decades. But the unwavering determination of the American spirit and its innovative identity won’t fast be undone.