Cryptocurrency companies in Dubai are now required to obtain authorizations and licenses to operate in the jurisdiction, according to new virtual asset rulebooks.
The extensive rules, published on Tuesday, outline requirements for companies in areas such as cyber security, compliance, and risk management standards.
Specific activities, such as issuance, advisory, custody, and exchange services, have their own set of rulebooks.
All companies and activities will be overseen by the Virtual Assets Regulatory Authority (VARA), which was established last year to regulate the crypto and blockchain sector in Dubai.
Dubai aims to become a regional fintech hub and is the most populous emirate in the United Arab Emirates (UAE).
Despite some companies claiming to have obtained VARA approval, a UAE lawmaker stated that no companies have licenses from the watchdog.
The new framework also covers advertising and promotion requirements for crypto firms and is part of a larger trend of regulators worldwide setting up frameworks to supervise the crypto industry after last year’s market crash.
VARA’s mission is to provide clarity and mitigate market risks while promoting innovation and sustainability. The framework is still pending final approval before implementation.
Dubai’s new virtual asset rulebooks are a step towards the emirate’s goal of becoming a leading fintech hub in the region.
