The Dubai Virtual Assets Regulatory Authority (VARA) is the regulatory body in Dubai, responsible for licensing and regulating certain activities across Dubai mainland and Free Zones (except DIFC). The activities VARA will oversee, and license include:
– Operating and managing virtual assets platforms services
– Exchange services between virtual assets and currencies or between one or more forms of virtual assets
– Virtual asset transfer, custody and management services custody
– Services related to the virtual asset portfolio and offering & trading of virtual tokens
The final list of licenses/activities shall be released once the new regulations for Virtual Assets and Virtual Assets Service Providers are finalized.
VARA is currently in the process of drafting the Virtual Asset regulations. Once these regulations are announced applicants will be encouraged to apply for licensing. The planned timeline for the start of licensing is in end of 2022.
Nonetheless, Dubai’s VARA has set an initial phase for a limited number of companies to operate on a very limited basis, by issuing provisional license.
In this phase, provisional license is issued to those entities which are already established in other regions with a solid client base. Upon submission of initial business plan, VARA will consider such submissions on case-to-case basis and determine the eligibility. For such companies to obtain a provisional license, there are certain pre-requisites including establishing a company in Dubai and certain mandatory appointments.
As of now, almost 45 companies were issued provisional license by VARA. This provisional license can prove advantageous to companies who are intending to develop their business in the region.
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