UAE strengthens virtual assets regulatory framework with updated rulebooks

The Dubai Virtual Assets Regulatory Authority (VARA) has announced significant updates to its activity rulebooks to promote greater market safeguards, risk transparency and operational resilience across the United Arab Emirates’ burgeoning virtual assets market.

The updates include enhanced supervisory mechanisms across a range of regulated virtual asset activities, including advisory services; broker-dealer services; custody services; exchange services; lending and borrowing services; virtual asset management and investment services; virtual asset transfer and settlement services, and virtual asset issuance rulebooks.

VARA said the changes would further strengthen controls around margin trading and token distribution services, clarify definitions for collateral wallet arrangements and harmonise compliance requirements across all licensed activities.

The revised rulebooks are publicly accessible on the regulator’s website. All virtual asset service providers operating in the country will be required to be fully compliant with the changes by 19 June. 

Commenting on the updates on a post on LinkedIn, VARA's General Counsel, Ruben Bombardi, said: “These updates reinforce Dubai’s position not only as a global hub for the VA industry, but as a trailblazer in setting clear, responsive and innovation-forward standards for responsible growth.”

Marie Chowdhry, a financial regulation expert at Pinsent Masons, said the development would be significant for both existing and incoming virtual asset service providers, and demonstrates “the UAE's continued commitment to being a global leader for the virtual asset industry.”

VARA began supervising Dubai’s virtual asset industry in 2022, making it the world’s first independent regulator dedicated exclusively to overseeing virtual assets. The regulator recently launched a real estate tokenisation project alongside Dubai Land Department and the Dubai Future Foundation, marking the first time that a real estate registration authority has implemented tokenisation of property title deeds in the Middle East.