Ruler of Dubai and Prime Minister of the United Arab Emirates (UAE), HH Sheikh Mohammed bin Rashid Al Maktoum, announced additional steps for the country to adopt crypto. This solidifies Dubai's ambitions to compete with other regulatory safe havens as the next hub for crypto and blockchain companies.
Lately, Dubai has become a crucial crypto hub for both investors and creators. The hotspot has hosted several crypto conferences in the past year, with the upcoming Crypto Expo taking place this month. Apart from hosting several events and approving an initial virtual assets law, a new regulatory authority has now been appointed as the official supervisor for the sector.
UAE wants to compete in the crypto market
As the financial capital of the Middle East, the UAE is the third-largest crypto market in the region, right behind Turkey and Lebanon, as per data compiled by Chainalysis. Prime Minister Mohammed bin Rashid noted that the goal is to “establish the UAE and Dubai’s position as a key player in designing the future of virtual assets globally.” This also explains why Binance, the largest crypto exchange by volume, is also reportedly eyeing a license in Dubai.
With the new rules, the Dubai Virtual Assets Regulatory Authority will authorize and oversee the operation and management of crypto platforms, virtual asset custody, and transfer, along with monitoring price manipulation in space. Among other roles, the protection of investor data will also be the regulator’s area of supervision.
New regulatory watchdog
The announcement also comes a day after the Securities and Commodities Authority (SCA) of the UAE stated that a new framework will assure AML/CFT compliance across the region. It includes eliminating risks of money laundering and terrorist financing, along with adhering to the recommendations and requirements of the Financial Action Task Force (FATF). What is noteworthy is that up until now, the SCA was the sole authority that supervised and oversaw the activities and services related to virtual assets in the UAE.
"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." - Muhammad bin Raschid Al Maktum, Vice President, Prime Minister and Minister of Defense of the UAE
Going forward, VARA will oversee the virtual asset space in Dubai, but it bars the regions under the state-owned financial free zone DIFC as per Reuters. Helal Saeed Almarri, the director-general of the Dubai World Trade Center (DWTCA) noted that the new law and the appointment of a sector regulator will strengthen the position of the UAE and Dubai by attracting leaders from around the globe.
