Dubai’s Virtual Assets Regulatory Authority (VARA) issued a written reproof to the four founders of OPNX Exchange and its CEO Leslie Lamb on April 18, according to a formal notice.
The four founders include Mark Lamb, Sudhu Arumugam, and founders of failed crypto hedge fund Three Arrows Capital, Su Zhu, and Kyle Davies.
As per the authorities, OPNX Exchange is unlicensed and unregulated. Therefore, the named individuals, including Zhu and Davies are breaking the law by operating and promoting it.
VARA first issued a cease and desist order for the establishment and marketing of the OPNX Exchange on February 27, according to the notice. Subsequently, the authorities found that the OPNX was restricted to the residents of the United Arab Emirates (UAE). However, the restrictions were not imposed on the marketing and promotion material of OPNX, which remained accessible to the residents, the authorities noted.
On March 10, VARA issued a second cease and desist letter, despite which, OPNX Exchange was launched on April 4. Thereafter, VARA issued an Investor and Marketplace Alert on April 12, warning investors that OPNX Exchange was unregulated.
In its notice, the Dubai authorities noted:
“VARA is continuing to actively monitor the situation and investigate OPNX’s activity to assess further corrective measures that may be required to protect the market.”
According to CEO Lamb, OPNX Exchange has not undertaken any marketing or promotion targeting Dubai or the UAE, and therefore, has not violated any laws. She told Bloomberg in a WhatsApp message:
“At no point in time have UAE customers been able to open an account on OPNX.”
Meanwhile, Zhu told Bloomberg that he and Davies are not involved in the day-to-day running of the OPNX Exchange — although they contributed to the “initial ideas for OPNX.”
Dubai authorities are trying to take a stricter approach toward crypto regulation while balancing its ambitions to become an industry hub. The actions against OPNX Exchange are an indication of Dubai authorities tightening the reigns.
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