Dubai Passes First Virtual Assets Law, Establishes Regulator

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Prime Minister and Vice President of the United Arab Emirates and ruler of Dubai, Sheikh Mohammed bin Rashid al-Maktoum attends the Global Women’s Forum in Dubai, United Arab Emirates February 16, 2020. REUTERS/Christopher Pike

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DUBAI, March 9 (Reuters) – The emirate of Dubai has passed its first law governing virtual assets and set up a regulator to oversee the sector, its leader, Sheikh Mohammed Bin Rashid, said on Wednesday.

The United Arab Emirates, a federation of seven emirates and the region’s financial capital, has pushed to develop virtual asset regulations to attract new forms of business as regional economic competition intensifies.

Virtual assets generally encompass products such as cryptocurrencies and NFTs, but the announcement did not specify which assets would fall under the new law.

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The Dubai Virtual Assets Regulation Act aims to position Dubai and the UAE as a regional and global destination for the virtual asset industry, Sheikh Mohammed said in a statement carried by state media.

The Dubai Virtual Assets Regulatory Authority will oversee the development of the virtual assets business environment in terms of regulation, licensing and governance, he said.

The new law will apply in Dubai, with the exception of the state-owned financial free zone DIFC. The DIFC’s regulator, the Dubai Financial Services Authority (DFSA), is working on its own regulation for the virtual asset industry.

In October, the DFSA published the first part that governs digital tokens and this week launched a consultation on the regulation of crypto tokens, which includes cryptocurrencies.

The UAE as a whole is moving closer to issuing regulations on investments in virtual assets, the UAE Securities and Commodities Authority (SCA) said on Tuesday.

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Reporting by Lilian Wagdy; Written by Nadine Awadalla and Lisa Barrington; Editing by Jon Boyle and Bernadette Baum

Our standards: The Thomson Reuters Trust Principles.

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