The Securities and Commodities Authority (SCA) and the Dubai Digital Property Regulatory Authority (VARA) introduced a coordinated method to the regulation of digital belongings (VAs) and their service suppliers within the UAE. The collaboration is designed to supply a coherent regulatory construction, giving market contributors better readability whereas reinforcing the UAE’s dedication to monetary innovation and its management within the digital economic system.

The joint method builds on two latest regulatory milestones: the Cupboard Decision No. (111) of 2022, regarding the regulation of digital belongings, and a cooperation settlement signed between the 2 authorities on 5 September 2024. These frameworks established mechanisms for the licensing and oversight of digital asset service suppliers (VASPs).

Aligned frameworks with clear jurisdictional boundaries

Beneath the coordinated method, the SCA and VARA have aligned their regulatory frameworks whereas sustaining distinct jurisdictional mandates to supply readability for the market.

The SCA’s mandate, beneath the 2022 cupboard decision, covers the regulation, licensing, and supervision of VASP’s throughout the UAE.

VARA’s mandate, established by Dubai’s Legislation No. (4) of 2022, covers the regulation of all types of digital belongings and their service suppliers throughout the Emirate of Dubai, excluding the Dubai Worldwide Monetary Centre (DIFC). Its oversight spans the complete lifecycle of digital belongings, from issuance and alternate to custody and buying and selling, in adherence with worldwide requirements for market integrity and threat administration.

The regulators said that this collaborative method will present a transparent construction for digital belongings within the UAE, giving issuers, brokers, custodians, and buyers the regulatory certainty wanted to innovate responsibly.

A worldwide centre for accountable innovation

With greater than 40 licensed VASPs now working in Dubai, the UAE is positioning itself on the forefront of the worldwide digital asset transformation.

H.E. Waleed Al Awadhi, chief govt officer of the SCA, said: “Our collaboration with VARA underscores the UAE’s dedication to a safe, clear, and innovation-friendly digital belongings setting. By clearly defining our respective regulatory mandates and aligning supervisory frameworks, we’re enabling accountable development of digital belongings and their service suppliers inside a well-defined regulatory construction. This joint effort helps the UAE’s imaginative and prescient of a resilient, digitally superior monetary ecosystem and reinforces our management in shaping next-generation monetary markets.”

Matthew White, chief govt officer of VARA, added: “This partnership between SCA and VARA offers a lot wanted market assurance and certainty to additional the convergence between conventional finance (TradFi) and digital belongings, positioning the UAE as a world centre for accountable innovation. Our shared goal stays to make sure that this borderless economic system is matched by the power of its regulatory foundations, working on the nexus of readability, accountability, and technological development. This stage of regulatory collaboration has allowed VARA as a specialist regulator to accommodate the biggest regulated ecosystem for VASPs on the planet.”