Dubai has adopted the first law of its kind in the emirate that regulates virtual assets, Sheikh Mohammed bin Rashid, Vice President and Ruler of Dubai, said on Wednesday.
The Dubai Virtual Asset Regulation Law is aimed at creating an advanced legal framework to protect investors and provide international standards for virtual asset industry governance that will promote responsible business growth in the emirate, Sheikh Mohammed said in a statement.
“We established an independent authority to oversee the development of the best business environment in the world for the virtual assets in terms of regulation, licensing, governance and in line with local and global financial systems,” he said on Twitter.
“The future belongs to whoever designs it … and today, through the virtual assets law, we seek to participate in the design of this new and rapidly growing global sector.”
Virtual assets include cryptocurrencies such as Bitcoin and non-fungible tokens (NFTs).
The UAE government is taking concrete steps to establish a strong digital economy and make use of the advantages provided by digital transformation.
The digital economy contributes about 4.3 per cent to the UAE's gross domestic product, which is equivalent to Dh100 billion ($27.2bn), government figures show.
The future belongs to whoever designs it … and today, through the virtual assets law, we seek to participate in the design of this new and rapidly growing global sector
Sheikh Mohammed bin Rashid,
Vice President and Ruler of Dubai
The Dubai Virtual Asset Regulatory Authority (VARA), which will be established under the new law, will regulate the sector throughout the emirate, including special development zones and free zones, but excluding the Dubai International Financial Centre.
The authority, which will also be responsible for licensing, has legal and financial autonomy over the virtual asset sector and will be linked to the Dubai World Trade Centre Authority (DWTCA).
The establishment of VARA comes as a part of the strategy of the Dubai Securities and Exchange Higher Committee.
The new law and establishment of VARA will enhance the UAE and Dubai’s position in the virtual asset sector and attract leaders from around the world, said Helal Al Marri, director general of the DWTCA.
“The Dubai Virtual Asset Regulatory Authority will provide a full range of VA [virtual asset] services in co-ordination with the Central Bank of the UAE and the Securities and Commodities Authority,” Mr Al Marri said.
The significance of the new law reflects the growth of the virtual assets sector in the UAE and the region, said Loredana Matei, founder of FinTech media platform Finsight News.
“The law comes on the same day as the new US executive order that sets the framework for cryptocurrencies, which signals that both the UAE and the US are becoming the leaders in the global adoption and regulation of digital assets,” Ms Matei said.
Meanwhile, Dubai's initiative to establish the law in a relatively new field represents a welcome leap into the future that aims to develop and protect investors, developers, traders and marketers, said Devesh Mamtani, chief market strategist at Century Financial.
“The … initiative will allow virtual asset management, the exchange of cryptocurrencies and will prevent manipulation of virtual asset prices,” Mr Mamtani said.
The law, which will come into effect from the date of its publication in the Official Gazette, defines the tasks of VARA to regulate, supervise and control virtual asset services.
It also stipulates that the authority is mandated to organise and set the rules and controls that govern the conduct of virtual asset activities, including management services, clearing and settlement services, in addition to classifying and specifying types of virtual assets.
The law says that it is prohibited for any person in the emirate to engage in activities without authorisation from VARA, while any person wishing to practise virtual asset activities must establish a presence in Dubai to conduct business.
The law defines the activities, subject to VARA authorisation, as follows:
- Operating and managing virtual assets platforms services
- Exchange services between virtual assets and currencies, whether national or foreign
- Exchange services between one or more forms of virtual assets
- Virtual asset transfer services
- Virtual asset custody and management services
- Services related to the virtual asset portfolio
- Services related to the offering and trading of virtual tokens
The acts that constitute a breach of the provisions of the law and the fines imposed on a violator will be determined by the board of directors of the DWTC, Mr Al Marri said.
In addition to a fine, VARA will also have the authority to either suspend permits for a period of up to six months, cancel the permit, or co-ordinate with the competent commercial licensing authority in Dubai to cancel the commercial licence of violators, he added.
“Regulatory oversight is always good for the industry as it helps it evolve and innovate in a more accountable way and brings more safety to investors,” said Vasja Zupan, president of Matrix, an Abu Dhabi-regulated crypto exchange.
“Dubai’s own efforts in this respect add to the overall regulatory push that will eventually propel the industry into mainstream adoption.”
The new law and the establishment of VARA is a step ahead for Dubai and will have a positive effect on the emirate's property market, said Lewis Allsopp, chief executive of property agency Allsopp & Allsopp.
“The law and regulatory authority is welcomed by all current and future citizens and residents of the UAE,” Mr Allsopp said.
“The real estate and holiday home industries are sure to benefit greatly and I predict this will entice property investors who can buy property with their cryptocurrency.”
The Birkin bag is made by Hermès.
It is named after actress and singer Jane Birkin
Noone from Hermès will go on record to say how much a new Birkin costs, how long one would have to wait to get one, and how many bags are actually made each year.
UAE currency: the story behind the money in your pockets
RESULTS
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5.30pm: Maiden (TB) Dh 70,000 (D) 2,000m
Winner: Miracle Maker, Xavier Ziani, Salem bin Ghadayer
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Winner: AF Almajhaz, Abdul Aziz Al Balushi, Khalifa Al Neyadi
8pm: Maiden (PA) Dh 70,000 (D) 1,000m
Winner: AF Lewaa, Bernardo Pinheiro, Qaiss Aboud.
COMPANY PROFILE
Name: Lamsa
Founder: Badr Ward
Launched: 2014
Employees: 60
Based: Abu Dhabi
Sector: EdTech
Funding to date: $15 million
The President's Cake
Director: Hasan Hadi
Starring: Baneen Ahmad Nayyef, Waheed Thabet Khreibat, Sajad Mohamad Qasem
Rating: 4/5
What is a Ponzi scheme?
A fraudulent investment operation where the scammer provides fake reports and generates returns for old investors through money paid by new investors, rather than through ligitimate business activities.
The biog
Family: He is the youngest of five brothers, of whom two are dentists.
Celebrities he worked on: Fabio Canavaro, Lojain Omran, RedOne, Saber Al Rabai.
Where he works: Liberty Dental Clinic
PSA DUBAI WORLD SERIES FINALS LINE-UP
Men’s:
Mohamed El Shorbagy (EGY)
Ali Farag (EGY)
Simon Rosner (GER)
Tarek Momen (EGY)
Miguel Angel Rodriguez (COL)
Gregory Gaultier (FRA)
Karim Abdel Gawad (EGY)
Nick Matthew (ENG)
Women's:
Nour El Sherbini (EGY)
Raneem El Welily (EGY)
Nour El Tayeb (EGY)
Laura Massaro (ENG)
Joelle King (NZE)
Camille Serme (FRA)
Nouran Gohar (EGY)
Sarah-Jane Perry (ENG)
Who's who in Yemen conflict
Houthis: Iran-backed rebels who occupy Sanaa and run unrecognised government
Yemeni government: Exiled government in Aden led by eight-member Presidential Leadership Council
Southern Transitional Council: Faction in Yemeni government that seeks autonomy for the south
Habrish 'rebels': Tribal-backed forces feuding with STC over control of oil in government territory
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Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.
Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.
“Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.
Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.
“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.
Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.
From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.
Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.
BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.
Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.
Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.
“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.
Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.
“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.
“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”
The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”
UPI facts
More than 2.2 million Indian tourists arrived in UAE in 2023
More than 3.5 million Indians reside in UAE
Indian tourists can make purchases in UAE using rupee accounts in India through QR-code-based UPI real-time payment systems
Indian residents in UAE can use their non-resident NRO and NRE accounts held in Indian banks linked to a UAE mobile number for UPI transactions
MOUNTAINHEAD REVIEW
Starring: Ramy Youssef, Steve Carell, Jason Schwartzman
Director: Jesse Armstrong
Rating: 3.5/5
Some of Darwish's last words
"They see their tomorrows slipping out of their reach. And though it seems to them that everything outside this reality is heaven, yet they do not want to go to that heaven. They stay, because they are afflicted with hope." - Mahmoud Darwish, to attendees of the Palestine Festival of Literature, 2008
His life in brief: Born in a village near Galilee, he lived in exile for most of his life and started writing poetry after high school. He was arrested several times by Israel for what were deemed to be inciteful poems. Most of his work focused on the love and yearning for his homeland, and he was regarded the Palestinian poet of resistance. Over the course of his life, he published more than 30 poetry collections and books of prose, with his work translated into more than 20 languages. Many of his poems were set to music by Arab composers, most significantly Marcel Khalife. Darwish died on August 9, 2008 after undergoing heart surgery in the United States. He was later buried in Ramallah where a shrine was erected in his honour.
The biog
Date of birth: 27 May, 1995
Place of birth: Dubai, UAE
Status: Single
School: Al Ittihad private school in Al Mamzar
University: University of Sharjah
Degree: Renewable and Sustainable Energy
Hobby: I enjoy travelling a lot, not just for fun, but I like to cross things off my bucket list and the map and do something there like a 'green project'.
The Farewell
Director: Lulu Wang
Stars: Awkwafina, Zhao Shuzhen, Diana Lin, Tzi Ma
Four stars
