Dubai Embarks on a New Era of Cryptocurrency Regulation with VARA Certification from August 31

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Dubai Embarks on a New Era of Cryptocurrency Regulation with VARA Certification from August 31

By Manoj Nair, Business Editor

Published: August 31, 2023 07:57 | Last Updated: August 31, 2023 11:07

STOCK CRYPTO / BITCOIN

Dubai opens a new chapter in the cryptocurrency sector as it embraces a stringent regulatory framework encompassing all digital asset businesses in the city. Be it buying a property with Bitcoin or settling a bill, every transaction is now governed by stringent rules.

![Image: A New Chapter for Cryptocurrency in Dubai | Credit: Shutterstock]

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Dubai: A Pioneer in Cryptocurrency Regulation

Dubai unveils a revolutionary pathway for cryptocurrency enterprises, ensuring a licensed and fully regulated operational framework under the city's established virtual asset regulatory authority. This monumental move requires businesses in the crypto sphere to demonstrate credible credentials, promising clients substantial security and potential compensation in case of discrepancies.

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VARA: Steering the Cryptocurrency Revolution in Dubai

Effective August 31, Dubai entities earmarked for the 'Full Market Product' license are set to transition under the VARA (Virtual Asset Regulatory Authority) regime. Notably, this shift demands compliance with an 'Initial Disclosure Questionnaire' circulated by VARA prior to April 30, with non-compliance attracting serious consequences. As noted by Arun John, Chief Market Analyst at Century Financial, businesses involved in virtual asset transactions must register with the appropriate authorities in line with the laid out licensing criteria.

![Image: VARA - Spearheading Virtual Asset Regulation in Dubai | Credit: Supplied]

The UAE: Forging Ahead in Cryptocurrency Regulations

In a global backdrop where significant jurisdictions are yet to formulate rudimentary regulatory frameworks for cryptocurrencies, the UAE emerges as a frontrunner, swiftly crafting policies to oversee the virtual asset domain. Spearheaded by VARA in Dubai, apart from DIFC, the objective is to position the UAE as a global epicenter for crypto-oriented businesses amidst current industry transitions.

Zana Musa, Director of Operations at Sovereign Corporate Services, emphasized a 33% spike in inquiries from potential local and international investors, eager to delve into the burgeoning UAE fintech landscape, propelled by recent events and the formation of the world's first independent virtual asset sector regulator.

VARA Certification: Your Passport to a Robust Crypto Business in Dubai

To secure VARA accreditation, crypto businesses underwent a meticulous process involving the submission of an Initial Disclosure Questionnaire and supplementary documents, such as business plans and executive management details. Following preliminary approval, firms had to meet various operational prerequisites before applying for a Virtual Asset Service Provider (VASP) license, encapsulating compliance with four principal rulebooks addressing diverse facets of business operations.

As Dubai fosters a dynamic and structured ecosystem for digital asset enterprises, the city promises a streamlined integration into the burgeoning digital asset economy.