Dubai forms Virtual Asset Regulatory Authority to provide global framework
Dubai has established a regulatory authority to regulate the operations of virtual assets and platforms that are relevant to the sphere. The Virtual Asset Regulatory Authority comes into existence to create a framework that other regions across the world can replicate. Moreover, it keeps up with the changing times through a transition to the digital world in every sense possible.
The most important of the regulatory authority’s many goals is to reduce risks and make it easier for virtual assets to be used across borders. Other goals include bringing virtual assets to the attention of the community.
The Virtual Asset Regulatory Authority has announced a partnership with regional organizations and authorities in an effort to achieve the stated objectives. It extends to the macro level, with the Dubai-based regulatory authority’s aims encompassing the following aspects:
- Positioning Dubai as the global hub for virtual assets by boosting the competitive edge;
- Enable investors to attract investments in virtual asset products and services; and
- Promote shared responsibility for developing regulations to protect the interests of investors.
The VARA, which stands for Virtual Assets Regulatory Authority, is also tasked with curbing illegal activities.
While there are several crypto exchanges in UAE, the regulatory authority has yet to grant an operating permit, which the platforms can only claim after they have gone through a 4-stage process. Platforms have mostly received approvals up to the second stage, allowing them to establish an office and secure a bank account.
The basic idea is to force responsible participation in the market to ensure social and economic stability, strong customer protections, and resilience across jurisdictions.
VARA has highlighted the 4-stage process beginning with the provisional permit, followed by the Preparatory Minimum Viable Product, the Operating Minimum Viable Product, and then the Full Market Provider. VARA is responsible for overseeing the procedure preceding the authorization of any enterprise’s operations.
Dubai has been looking to come out as a progressive region for new technologies. VARA’s establishment closely follows the 2022 release of the Dubai Metaverse Strategy, having seen the release of the Dubai Blockchain Strategy in 2016.
The Unified Business Registry Platform and the UAE Center for the Fourth Industrial Revolution are additional innovations that support Dubai’s goal of becoming a global hub. The goal is to deploy crypto initiatives across important industries such as real estate, logistics, and the metaverse. In Dubai, expansion and innovation will undoubtedly play a significant role.
The Dubai Government has committed to organizing over a hundred crypto events every year. This is backed by the Dubai Future Foundation, which has launched a Global Blockchain Council.
VARA remains the leading institution in the region for coordinating and governing crypto operations to raise awareness, attract global investment, and curtail unlawful actions in digital assets.