The United Arab Emirates (UAE) took a major step towards harmonizing its method to crypto regulation. The nation’s Securities and Commodities Authority (SCA) and the Dubai Digital Property Regulatory Authority (VARA) introduced a strategic partnership to unify the UAE’s method to crypto laws.
Final September, the regulators expressed their intention to work collectively towards unifying crypto frameworks within the nation. One characteristic of the partnership is that it’ll enable Dubai-based licenses to service all the UAE, based on a Wednesday announcement shared with Cointelegraph.
A VARA spokesperson informed Cointelegraph that the newest improvement formalizes the settlement between the 2 regulators and “operationalises that intent” with concrete mechanisms.
“In essence, the 2024 MOU was a place to begin. The present partnership is its formal and useful implementation,” VARA mentioned.
Licensing reciprocity, not computerized passporting
Whereas the settlement establishes a mechanism for mutual recognition of licenses between SCA and VARA, it won’t supply computerized “passporting” of licenses throughout jurisdictions.
“Licensing reciprocity is a key characteristic of the partnership, however not computerized passporting,” the spokesperson mentioned.
The spokesperson clarified that the settlement establishes a mutual recognition mechanism between the SCA and VARA.
Because of this a VASP licensed by one authority might be acknowledged by the opposite. Nonetheless, they are going to be topic to coordination protocols and relevant regulatory checks.
“This consists of AML/CFT assessments, operational readiness, and supervisory alignment, making certain that nationwide safety and compliance requirements stay sturdy,” the spokesperson informed Cointelegraph.
For VASPs working and eager to function within the UAE, the partnership supplies regulatory readability, decreased duplication and a streamlined path to nationwide protection.
The VARA spokesperson mentioned this eliminates the necessity to navigate “separate, probably conflicting” approval processes, which “lowers operational danger and improves velocity to market.”
“It additionally strengthens the UAE’s international attraction as a reputable, innovation-first jurisdiction with a unified method to digital asset oversight,” the spokesperson added.
SCA kinds committee to refine laws
The mechanisms embody a unified digital asset service supplier (VASP) registration framework, mutual license recognition, real-time information sharing and joint supervision protocols, cross-jurisdictional Anti-Cash Laundering (AML) coordination and the formation of a Legislative Overview Committee.
The SCA permitted the formation of the committee, which is remitted to work with VARA to guage and refine crypto laws within the nation according to worldwide greatest practices. This alerts dedication from each events to construct a globally aggressive regulatory surroundings.
Officers from each regulators described the partnership as a serious step in positioning the UAE as a pacesetter in crypto governance.
VARA CEO Matthew White referred to as the partnership “a pivotal second” within the journey to future-proof the UAE’s digital financial system. On the similar time, SCA CEO Waleed Al Awadhi mentioned transparency and belief are central to attracting funding.
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A broader effort to boost regulatory coordination
Whereas the latest improvement is a bilateral settlement between the SCA and VARA, the spokesperson informed Cointelegraph that it’s a part of a broader UAE effort to boost national-level regulatory coordination.
VARA mentioned that there’s an ongoing dialogue between different regulators, together with the Abu Dhabi World Markets (ADGM) and native and worldwide stakeholders to advertise interoperability, supervisory consistency and cross-border cooperation.
“Future collaborations stay a strategic precedence,” the spokesperson added.
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