On Thursday, Dubai’s Virtual Assets Regulatory Authority (VARA) announced a new rulebook meant to regulate the crypto industry. This move forms part of Dubai’s wider plan to become a financial technology hub.
VARA said that any firm looking to issue digital assets in the Emirate must fully comply with the new regulatory framework, including applying for a permit to set up operations in Dubai.
Further, the agency explained that the intention of the rulebook was to attract crypto firms, prevent illegal practices, and safeguard virtual assets investors while promoting Dubai as an international and regional hub for digital assets.
In a statement, VARA’s Director General Helal Saeed Alamrri said that the goal is to position Dubai as the capital of the digital economy anchored by AI, metaverse, blockchain, and Web3.
Alamrri described VARA as the world’s leading regulator for digital assets to promote a digital economy. He added that the agency’s rulebook shows Dubai’s commitment to developing responsible safeguards for crypto stakeholders.
Dubai Adopts Blockchain Technology to Deliver Services
Since 2019, Dubai has made major steps into the blockchain industry. A notable one happened two years ago when the Dubai Department of Economic Development moved its services to Unified, a blockchain-based business registry platform.
Numerous blockchain firms, including Binance, already have licenses to operate in Dubai. The crypto exchange entered a deal with Dubai World Trade Centre Authority that would help other crypto firms get permits in the Emirates.
Further, the new rulebook states that any company wanting to do business using crypto must first get a license and authorization from VARA before they proceed to offer their service.
It also states various reasons that could lead to the license being revoked. They include material violation of stipulated laws and directives, bankruptcy, and failure to pay penalties as ordered by a court within Dubai or foreign-based.
Moreover, VARA explained that the new rules in regard to money laundering included financing terrorist activities alongside market manipulation and insider trading.
Who’s Exempted From the Rulebook?
There are some exemptions in the rulebook, like the professional exemption intended for all duly registered practicing accountants or any other consultants who conduct activities that involve digital assets in a way that is totally incidental to their line of work.
