Sheikh Mohammed bin Rashid Al Maktoum’s official Twitter account announced on Wednesday that Dubai’s principal digital property legislation has been recognised, and the Dubai Digital Property Regulatory Authority (VARA) has been established.
The Dubai Digital Asset Regulatory Authority is in charge of monitoring the purchasing, trading, and issuing of “digital property and digital tokens,” according to the statement.
The VARA is also planned to be an autonomous authority under the Dubai World Trade Centre Authority that will be in charge of overseeing the regulation, governance, and licensing of cryptocurrencies, non-fiat currencies, and other virtual assets.
Dubai joins the list by becoming the latest country to regulate crypto assets, joining Singapore, the United States, the United Kingdom, El Salvador, and other countries proving the fact that this list will grow exponentially. Dubai has established the Virtual Asset Regulation Law to control this new-age industry, which has been quickly growing.
Dubai has passed its first law regulating the cryptocurrency industry. It has also created a separate regulatory body to regulate crypto-related activities and service providers.
The Prime Minister of the United Arab Emirates, Sheikh Mohammed bin Rashid Al Maktoum, has approved a decree controlling virtual assets, as well as forming an independent organisation to supervise the crypto space’s governance.
The first virtual assets law has been adopted in Dubai, and the Dubai Virtual Assets Regulatory Authority (VARA) has been founded, according to Sheikh Mohammed bin Rashid Al Maktoum’s official Twitter account.
Today, we approved the virtual assets law and established the Dubai Virtual Assets Regulatory Authority. A step that establishes the UAE’s position in this sector. The Authority will cooperate with all related entities to ensure maximum transparency and security for investors. pic.twitter.com/LuNtuIW8FM — HH Sheikh Mohammed (@HHShkMohd) March 9, 2022
“A step that establish es the UAE’s position in this sector.”
This post was well received, with users like @justbeingmendy stating that she will be moving to Dubai shortly for this reason.
“Dubai, always has been on the forefront of advancement in technology, crypto, and proper execution of processes for a sustainable society”
I am moving to Dubai soon for this very reason. Dubai, always has been on the forefront of advancement in technology, crypto, and proper execution of processes for a sustainable society. Several world leaders could learn a lot by the creation and evolution of Dubai. — Mendy (@justbeingmendy) March 9, 2022
Sheikh Mohammed bin Rashid, according to @KashifHai, is a visionary leader for making such a courageous decision.
Wow, only a visionary leader can take such a bold decision. — Kashif Syed Noor (@KashifHai) March 9, 2022
According to an official statement, the ratification of rules governing the crypto sector in Dubai is aimed to set “much-needed international standards” to define the fledgling business. Sheikh Mohammed, who noted that this is the first law of its kind to control virtual assets, stated, “We established an independent authority to oversee the development of the best business environment in the world … in terms of regulation, licensing, [and] governance”
Virtual Assets Regulatory Authority
The Dubai Virtual Asset Regulatory Authority is in charge of monitoring the trade and issuance of “virtual assets and virtual tokens,” according to the release. It’s also in charge of approving and overseeing virtual asset service providers (VASPs).
The authority must also ensure that “the highest standards of protection for beneficiaries’ personal data” are met.
VARA will be in charge of regulating and licensing the sector all across free zone territories and the mainland, with the exception of the Dubai International Financial Centre (DIFC). The authority will be in charge of designing and arranging the procedures and norms that will regulate VA activities like clearing, management, and settlement services, as well as defining and classifying virtual asset kinds. VARA will also provide a broad range of services in partnership with the UAE Central Bank and the Securities and Commodities Authority. VARA authorizes and regulates crypto trading platforms that offer exchanges between cryptocurrencies and fiat currencies, as well as between one or more cryptocurrencies. The new legislation also regulates organizations that provide crypto transfers, custody, and asset management services. Virtual asset-related businesses would also have to register. These firms include cryptocurrency exchanges, businesses that allow bitcoin transfers, and so on.
The new law will apply throughout Dubai, with the exception of the government-owned DIFC financial-free zone. The Dubai Financial Services Authority (DFSA), the DIFC’s regulator, is working on its own virtual asset legislation.
The United Arab Emirates’ Abu Dhabi and Dubai have recently emerged as emerging crypto centres.
To encourage new firms, the UAE has been advocating for the development of crypto legislation. The Securities and Commodities Authority (SCA), the UAE’s securities regulator, said Tuesday that the country is going forward to establishing its own crypto regulatory framework.
To attract new companies, a specialised zone for virtual assets was formed in the Dubai World Trade Centre (DWTC) in December last year as regional economic competition heated up. The UAE’s authorities have also promised heavy punishments for crypto scammers who prey on the country’s investors. In addition to jail time, violators could face a fine of up to AED 1 million (approximately Rs. 2 crore).