Dubai, which is already a popular destination for the crypto and web 3.0 community, may have done the industry a big favour. On March 9, the city adopted its first law meant to regulate the operations of cryptocurrencies and digital assets, like non-fungible tokens (NFTs). The same was confirmed via a tweet from Sheikh Mohammed bin Rashid Al Maktoum, the prime minister of the United Arab Emirates (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,” Maktoum said in his tweet.
What are dubai plans?
Under the new law, the UAE wants to establish a Dubai Virtual Assets Regulatory Authority (VARA), which would be tasked with regulating these assets. The VARA is also supposed to be an independent authority under the Dubai World Trade Centre Authority, which will oversee the regulation, governance, and licensing of cryptocurrencies, NFTs, and other virtual assets.
The VARA’s main responsibilities include regulating the issuance of new crypto tokens, supervising and controlling the trading of virtual assets, ensuring that high standards of protection are in place, monitoring transactions, and more. The transfer of virtual assets, management services, exchange services, operating virtual assets platforms, and virtual asset custody is also under the VARA’s domain.
Further, the new law prohibits anyone from engaging in crypto-related activities without the Dubai VARA’s authorization. In addition, people who want to deal in virtual assets will have to establish a presence in Dubai.
Maktoum said that the country wants to establish Dubai as a “key player in designing the future of virtual assets globally”.
Dubai has been gaining ground with the crypto community
The country is already favoured by many in the web3 community. In December last year, the Dubai Media Office said that the Dubai World Trade Centre would officially become a crypto zone, from where all companies operating cryptocurrencies and virtual assets can operate. At the time, a statement from the city’s media office said it would establish “rigorous standards” for investor protection and prevent money laundering.
In 2021, a crypto-based relief fund in India was routed through entities in Dubai since regulations in the UAE are more favourable for such conversions.
The article originally published on Business Insider.