Web3 Wallet Backpack Launches Registered Crypto Business in Dubai

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Sujha Sundararajan

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Sujha Sundararajan

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November 9, 2023 11:28 EST

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Backpack, an all-in-one Web3 wallet, has become the latest to receive a Virtual Asset Service Provider (VASP) license in Dubai. The approval will enable Backpack to launch a regulated cryptocurrency exchange service in the city.

Per the company’s press release, Backpack Exchange is set to launch in private beta for its members in November before going live to the public in early 2024. The beta version will feature spot crypto trading functionality, it added.

The license from the Dubai VARA only covers the crypto exchange and not any other Backpack’s digital asset services.

The company described the launch as “a next-generation exchange” that incorporates various features. This includes zero-knowledge proof of reserves, (zk-proofs), Multi-Party Computation (MPC) for custody, and low latency order execution.

Backpack Exchange would showcase transparency, putting an end to opaque crypto exchanges, said Armani Ferrante, CEO and founder of Backpack.

“It shouldn’t be normal to use an exchange with a single point of failure, without proof of reserves, or auditability. A verifiable, unforgeable ledger is the exact problem blockchains solve, and Backpack Exchange is taking full advantage of that.”

Dubai’s Crypto License Approval Spree

Dubai’s VARA has been approving licenses to various crypto businesses in the recent past. However, a spokesperson from the license approval body noted that “the licensing process is rigorous” and qualifies only ‘responsible participants.’

“Backpack Exchange must be recognized for their commitment to prioritize investor protection and risk assurance,” the spokesperson noted.

“VARA appreciates their readiness to fulfill necessary prerequisites that have made them among the first VA exchanges to secure a full market license within the VARA regime.”

Further, the announcement said that the Backpack Exchange team will work to add trading functionalities including derivatives, margin and cross-collateral. The compliance team has professional experience with leading industry players such as Barclays, State Street, HSBC and Coinbase, it added.

The Solana framework development company Coral created Backpack, which also heads the NFT project Mad Lads.