Business Maverick: FTX Chaos Prompts Reckoning on Dubai’s Embrace of Crypto Giants

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On Oct. 26, days before the collapse of his crypto exchange FTX, Sam Bankman-Fried sat for lunch at an upscale Dubai restaurant, subtly testing the waters for funding at a table of founders, bankers and financiers, including Anthony Scaramucci.

have trimmed headcount in Dubai. Among those rethinking their foray into the sector is Hazem Shish, a former Barclays Plc banker who recently set up a crypto hedge fund in Abu Dhabi. While it performed well in its early months, challenges in raising institutional money amid the market turmoil prompted him to step back from the main fund’s management, according to people familiar with the matter, who requested anonymity as the information is private.

Some 4% of FTX’s global customers are based in the UAE, according to court filings in the firm’s bankruptcy case, making it one of the top 10 jurisdictions impacted by the fallout. “As a regulator, there’s always the risk that if things go wrong it looks really bad,” said Dapo Ako, a former compliance specialist at UBS Group AG, whose firm J. Awan & Partners is helping crypto firms set up in the UAE. “But it’s also a chance to rethink the framework. If Lehman didn’t fail, we wouldn’t have new banking regulations.

 

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