Dubai Officiates Rulebooks for Crypto Firms as it Prepares to Become Web3 Hotspot

These rules aim to slash the after-effects of any crypto slumps.

Written by Radhika Parashar, Edited by Richa Sharma | Updated: 2 March 2023 20:26 IST

Dubai Officiates Rulebooks for Crypto Firms as it Prepares to Become Web3 Hotspot

Photo Credit: Reuters

The UAE has been taking several pro-crypto measures in recent months

Highlights

The UAE is ready to tighten noose around new crypto firms
The aim is to safeguard its crypto community against market slumps
Dubai has an authority body called VARA to oversee the crypto industry

Dubai has been taking several pro-crypto steps to establish itself as a crypto hub. The city has now released a set of new regulations that would be mandated to be adhered to by crypto firms looking to operate from Dubai. Four rulebooks have been prepared for crypto service providers, detailing the regulations. In addition, several other rulebooks have been compiled outlining the laws around activity-based services around the crypto sector. These rules aim to slash the after-effects of any crypto slumps.

Dubai has now imposed an application charge of $27,000 (roughly Rs. 22 lakh) for crypto firms seeking operational permissions, CoinDesk said in its report.

The Emirate has also decided to levy an annual supervision fee of around $55,000 (roughly Rs. 45 lakh) that crypto firms will have to cover if they wish to bag a licence in Dubai.

In case the approval-seeking crypto firm intends to bring services like custody, lending or payments around crypto, they will be required to apply for additional documentation.

By choosing to expand their array of services, crypto firms could avail a 50 percent discount on the application fees.

Binance and Hex Trust, an institutional crypto custody provider, have bagged operational approvals in Dubai.

Last year, Dubai created a special regulatory unit called the Virtual Assets Regulatory Authority (VARA) to oversee crypto-related businesses there.

While regions of the UAE, like Dubai and Abu Dhabi, are working on attracting crypto firms to set offices there, the nation overall is accelerating its efforts to bring out its CBDC.

As part of its Financial Infrastructure Transformation Programme (FIT), the financial authorities of the UAE have begun working on developing the required technical and cyber security support for its blockchain-based e-currency.

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Further reading: Cryptocurrency, Dubai, CBDC

Radhika Parashar

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Radhika Parashar is a senior correspondent for Gadgets 360. She has been reporting on tech and telecom for the last three years now and will be focussing on writing about all things crypto. Besides this, she is a major sitcom nerd and often replies in Chandler Bing and Michael Scott references. For tips or queries you could reach out to her at RadhikaP@ndtv.com. More