UAE’s vice president and premier, Sheikh Mohammed bin Rashid Al Maktoum, announced on March 9 that the United Arab Emirates had adopted its first law to regulate crypto assets. In orienting the future of virtual assets globally, the law would help the UAE and Dubai establish themselves as key players. During a tweet exchange, Rashid Al Maktoum said, ‘We have created an independent authority to oversee the development of the best business environment regarding virtual assets in terms of regulation, licensing, and governance.’
The Dubai Virtual Asset Regulatory Authority (VARA) oversees and executes the law on virtual assets. Dubai’s virtual asset regulation will operate in the following ways, under the supervision of VARA:
● In addition to overseeing crypto activities and service providers, VARA would also serve as a regulator.
● VARA would be responsible for approving and monitoring the trading and issuance of virtual assets and virtual tokens.
● The organization will also be responsible for approving and regulating virtual asset service providers (VASPs).
● The regulatory authority must ensure that beneficiaries’ personal information is protected.
● It is also required to ensure the safety of virtual asset transactions.
● VARA would also authorize and regulate crypto trading platforms that offer exchanges between cryptocurrencies and fiat currencies or between two crypto currencies.
● Several crypto-related services, including transfers, custody, and management, would also be regulated.
● The Dubai International Financial Centre (DIFC) is an independent free zone, so it is not affected by the new law.
● Dubai Financial Services Authority (DFSA) is developing its cryptocurrency regulation.
● UAE securities regulator (SCA) is the sole authority on the UAE mainland responsible for licensing, overseeing, and licensing virtual assets activities.
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