- The Virtual Assets Regulatory Authority (VARA), the regulatory authority in charge of overseeing cryptocurrency laws within Dubai, has released new guidelines for virtual asset service providers operating within the emirate.
- This set of regulations sets out requirements for cryptocurrency companies that cover everything from issuance and exchange services to advertising.
- This new framework, which also covers advertising and promotional requirements for cryptocurrency companies, still needs final approval before being implemented.
Dubai, One of the seven emirates that make up the United Arab Emirates, known worldwide for its luxurious trade, ultra-modern architecture and lively nightlife, has taken a new step towards regulating digital assets at its borders.
It is no secret to anyone that the nation It has a clear objective in terms of crypto assets, to become a financial technology center, which obviously includes cryptocurrencies.
Dubai dictates new rules for crypto companies
With that goal in mind, the regulator in charge of overseeing cryptocurrency laws within Dubai recently, the Virtual Assets Regulatory Authority (VARA), issued a series of new guidelines for Virtual Asset Service Providers (VASPs) operating within the emirate.
In this regard, the regulatory authority stated that any entity in the emirate that issues digital assets, is obliged to abide by your rule book, being the first step of many, applying for a license to operate in Dubai.
Everything seems to indicate that the new statutes have the main purpose of helping to attract crypto companies, in addition to safeguarding crypto asset traders and investors, while trying as far as possible to curb illegal practices, all in the service of promoting Dubai as a regional and international hub for virtual assets.
“With bespoke rules and guidelines designed to provide clarity, ensure certainty and mitigate market risks, VARA seeks to develop a model framework for global economic sustainability within an innovation-focused environment that is truly borderless, technology agnostic. and focused on the future“said the regulator.
In this regard, the Director General of the Department of Economy and Tourism of Dubai and Chairman of the Executive Board of VARA, Helal Saeed Almarri, said in a statement that the new regulation aims “establish the emirate as the capital of the future economy anchored in metaverse, AI, Web3.0 and blockchain“.
“This custom-designed build reflects the UAE’s commitment to building responsible safeguards and Dubai’s confidence in delivering a progressive VA ecosystem that fosters next-generation innovation.”he added.
New crypto regulation in Dubai
For her part, UAE-based blockchain and digital asset lawyer, Irina Heavernoted that the “Rcomprehensive regulation of market products“, consists of four mandatory regulations and activity-specific regulations that establish the rules for the operation of VASPs.
Similarly, he pointed out that these rules will only have an effect on market participants within Dubai, excluding those that operate under the Dubai International Financial Center (DIFC), since the region has its own regulator.
Another relevant point about the new regulation is that, according to VARA, all market participants without exception, whether they have a license to STICK or not, they are subject to compliance with marketing, advertising and promotional regulations.
Similarly, the regulator pointed out that those who do not comply with the new measures will be subject to fines of between 20,000 dirhams (approximately $5,500 dollars) and 200,000 dirhams (approximately $55,000 dollars).
Similarly, if someone becomes a repeat offender, they could be fined up to 500,000 dirhams (approximately $135,000).
Regulations provide guidance on other issues
It should be noted that the new rules also address other types of issues, such as the issuance of virtual assets. According to the lawyer, there are several conclusions from the new VARA update, such as the refusal to issue privacy coins in Dubai, in addition to the fact that merchants with a trading capital of more than $250 million must be registered. in ROD.
The same waythe new regulation also has a rate for advisory services, licensing and annual supervision of stock exchange, custody, loan and brokerage services. According to the document, prices range from 40,000 dirhams (11,000 dollars) to 200,000 dirhams (55,000 dollars), depending on the services.
Likewise, the Dubai regulator also specified in its regulations, money laundering, which includes the financing of terrorism and other illegal organizations, in addition to prohibiting the use of privileged information, illegal disclosure and market manipulation.
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