thecoinrise.com
Dubai, the country which is known for its positive stance on crypto, has announced a new set of regulations on digital assets along with the establishment of a crypto regulatory body.
In an announcement on Wednesday, the prime minister, Sheikh Mohammed bin Rashid Al Maktoum said he has issued a new law by creating a legal framework for digital assets in the Emirate of Dubai to protect investors and design “much-warranted international standards” for the crypto industry governance.
Moreover, the government has also formed a new crypto regulatory body – Dubai Virtual Asset Regulatory Authority, or VARA that would possess the enforcement powers in free zones and special development with the exception of the Dubai International Financial Centre.
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. pic.twitter.com/LuNtuIW8FM
— HH Sheikh Mohammed (@HHShkMohd) March 9, 2022
The crypto law, according to Sheikh Al Maktoum, will force residents of the Emirate to register with VARA before participating in the crypto-related activity. Companies that deal with virtual assets must also have a representation in Dubai. These operations include running a crypto exchange, transmitting cryptocurrencies, and providing other token-related services.
The announcement did not clarify which cryptocurrencies would be covered by the law, but it did say that VARA would define and specify the different forms of virtual assets, as well as establish regulations and controls.
Anyone caught breaking the new rule might face fines as well as having their company license suspended or revoked.
Dubai still has to take many decisions
It’s unclear how the legal framework will affect free zones like the Dubai World Trade Centre, which stated in December that it would become a complete zone and regulator for cryptocurrency, products, operators, and exchanges. Binance CEO Changpeng Zhao, who has very good relations with the country, praised the establishment of VARA in Dubai, adding that regulatory certainty for cryptocurrencies was critical.
Being an Emirate in the UAE, it mostly has its own laws, operating multiple “free zones” to let people incorporate companies and apply for trade licenses. In October last year, as TheCoinRise reported, the Dubai Financial Services Authority announced fresh regulations for investment tokens.