As a result of new regulations encouraging the use of blockchain apps for regional economic advancement, the United Arab Emirates (UAE) is expected to become a hotspot for virtual assets such as non-fungible tokens (NFTs), blockchain, and cryptocurrencies.
This week, the UAE Cabinet passed a new virtual asset law and established an autonomous regulatory authority for crypto, NFTs, blockchain, and their traders, making it the UAE’s first federal level regulatory authority in this sector.
The Dubai Virtual Assets Regulatory Authority (VARA) and the Dubai Virtual Asset Regulation Law will regulate, control, and licence cryptocurrency-related businesses. Both the law and the authority will take effect on January 15, 2023.
The Founder of Liminal, a Singapore-based digital wallet, Mahin Gupta, expressed delight at the UAE’s accelerated pace of regulation of the virtual asset sector.
According to him, the move will make the UAE a top choice for companies looking to expand in this industry.
According to the latest data from the Dubai Multi Commodities Centre (DMCC), over 500 of the 3,049 companies registered in Dubai in 2020 were cryptocurrency startups.
In response to the aforementioned point, Mahin stated that data indicates Dubai will become a primary hub for crypto-related products and services. This law applies to exchanges, companies that facilitate cryptocurrency transfers, and other similar businesses.
However, the government-owned Dubai Financial Services Authority (DFSA) financial-free zone is said to be exempt from this rule. It is because the DFSA is developing its own laws that will allow the virtual asset market to be used there.
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