Dubai Ruler issues Virtual Asset Regulation Law and creates crypto regulator


On Wednesday 9th March, His Highness Sheikh Mohammed bin Rashid Al Maktoum, Vice President and Prime Minister of UAE and Ruler of Dubai, has approved a new law to regulate virtual assets in Dubai.

The Dubai Virtual Asset Regulation Law is a legal framework to protect investors and promote responsible business growth within the virtual asset industry, whilst providing governance that implements the highest international standards.

An independent authority, established under Dubai World Trade Center Authority, will oversee the licensing, regulation, and governance of all types of virtual assets including non-fungible tokens (NFTs), and cryptocurrencies.

The Dubai Virtual Asset Regulatory Authority (VARA) will regulate, supervise, and control virtual asset services. The authority set the rules and controls that will govern the conduct of virtual assets activities, including management, clearing, and settlement services, as well as classifying different types of virtual assets.

Sheikh Mohammed bin Rashid confirmed that Dubai will be a key player in designing the global future of virtual assets;

“Today, we are participating in designing the future of virtual assets globally.” he said. “Approving the virtual asset law and establishing the Dubai Virtual Asset Regulatory Authority is a vital step that establishes the UAE’s position in this sector, a step that aims to help the sector to grow and protect investors.”

The Dubai Virtual Asset Regulatory Authority will be responsible for licensing and regulating the sector across Dubai Mainland and Free-Zone territories (with the exception of Dubai International Financial Centre (DIFC).

VARA’s main responsibilities will include:

  • Regulating the issuance and release of virtual assets and NFTs
  • Regulating and licensing virtual assets service providers
  • Protecting personal data of users and beneficiaries
  • Regulating and monitoring the platforms offering cryptocurrencies and digital wallets
  • Monitoring digital transactions
  • Preventing the manipulation or modification of prices of virtual assets

The activities subject to VARA approval are:

  • Operating and managing virtual assets platforms services,
  • Exchange services between virtual assets and currencies, whether national or foreign,
  • Exchange services between one or more forms of virtual assets,
  • Virtual asset transfer services,
  • Virtual asset custody and management services,
  • Services related to the virtual asset portfolio,
  • Services related to the offering and trading of virtual tokens.

“Dubai will provide the most advanced virtual asset ecosystem in terms of organisation, governance and security,” Sheikh Mohammed bin Rashid added.

For more information please contact Alpha Management.