The Government of Dubai has passed the first legislation controlling virtual assets, as well as forming an exclusive regulator to supervise the industry, at a time when virtual assets are becoming an important component of the UAE economy.
Traditional financial services have grown rapidly in the past two decades in Dubai, a key regional financial services centre. Traditional banking and the virtual asset market have been increasingly entwined in recent years, as firms have embraced digital/cryptocurrencies and non-fungible tokens (NFTs) in their daily operations.
They have the potential to make payments easier, quicker, and less expensive, as well as providing alternative payment options for individuals who do not have access to traditional financial products. They risk becoming a virtual safe haven for financial criminals if they are not properly regulated.
Due to the nature of the blockchains that enable virtual assets, transactions on public blockchains can be completely anonymous. As the popularity of virtual assets grows, regulators throughout the world are paying more attention to the concerns associated with crime, money laundering, and terrorist funding. The new virtual assets regulation law and regulatory authority in Dubai covers the whole spectrum of virtual assets, from running and administering virtual asset platforms to providing virtual asset management services.
While acknowledging the inherent dangers connected with the sector, the UAE has been eager to accept and deploy asset digitalization.As a result, authorities must control the industry in collaboration with the country's different on-shore and off-shore financial and market regulators. The virtual asset business will continue to be a source of considerable dangers without a strong regulatory framework and continual supervision.
The Dubai Virtual Asset Regulation Law, as well as other legislation controlling virtual assets in the country, will ensure that all stakeholders' interests are protected while establishing Dubai and the UAE as regional and global virtual asset destinations.
SOURCE: Gulf News
LINK: https://gulfnews.com/opinion/editorials/virtual-assets-law-to-attract-global-pools-to-uae-1.86338883
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