The Virtual Asset Regulatory Authority of Dubai is exploring strategies to reduce the compliance costs for businesses to adhere to its guidelines, especially regarding cryptocurrencies. Let’s see all the details below.
The goal of Dubai’s regulation: reducing costs for small crypto businesses
As anticipated, the leader of the Dubai Virtual Asset Regulatory Authority has stated that he is committed to finding solutions to reduce costs for small businesses operating in the crypto sector.
During the Paris Blockchain Week, Matthew White, CEO of the Virtual Assets Regulatory Authority (VARA) in Dubai, highlighted his commitment to adapting the regulatory framework to the needs of all stakeholders:
“I am currently exploring various options to make our regime and regulations accessible to everyone. One of the main considerations is addressing compliance costs for smaller entities.”
As the sole regulatory body for digital assets in the emirate, VARA is responsible for overseeing the cryptocurrency sector, an integral part of the economic landscape of the United Arab Emirates.
The regulations introduced last year by Dubai for cryptocurrencies have been generally positively received by the industry. However, some concerns have been raised regarding the potential financial burdens resulting from compliance with the new provisions.
According to the rules, companies must obtain authorization to operate in the country. So far, prominent companies like Crypto.com, Deribit, and Nine Blocks have obtained the necessary licenses to conduct their activities in the field of cryptocurrencies.
White has highlighted the challenges that smaller businesses may face in meeting regulatory requirements:
“We have noticed that many of them do not have the necessary resources to meet our standards. We are exploring solutions such as creating structures where larger participants can support smaller ones, thus facilitating access to the market.”
Crypto.com obtains VASP license in Dubai
The Dubai Virtual Asset Regulatory Authority has recently awarded Crypto.com a license as a virtual asset service provider. This allows the cryptocurrency exchange to offer services to institutional investors in the emirate.
Eric Anziani, president and COO of Crypto.com, emphasized the importance of this step for the growth and continued success of the company in a strategic market.
Crypto.com is further expanding its presence in Asia and Europe, ensuring crypto licenses in various jurisdictions.
Furthermore, it was one of the first international operators to enter the Dubai market after obtaining provisional approval from the Virtual Assets Regulatory Authority (VARA) last November,
The cryptographic scene in Dubai has seen rapid development after the creation of VARA in March 2022, aiming to oversee the city’s digital resource ecosystem and promote innovation without compromising investor security.
VARA introduced a comprehensive regulatory regime in February of last year, providing clear guidelines for crypto operators and virtual asset service providers interested in operating within the United Arab Emirates.
Despite Dubai appearing to offer a favorable environment for cryptocurrencies, reports indicate that the region may present challenges for entrepreneurs in the sector.