The Virtual Assets Regulatory Authority (VARA) stands as a pioneer in the world of virtual asset regulation, impacting areas far beyond its home base in Dubai. The groundbreaking institution’s influence notably extends to Abu Dhabi, where numerous startups are capitalizing on the benefits provided by VARA’s intricate regulatory framework and supportive environment.
Established as the world’s initial independent regulatory authority for virtual assets, VARA is a beacon of trust and transparency in the emerging domain of virtual assets. It’s particularly designed to assure permissible activities and services for customers and investors, lending clarity and certainty, and helping to mitigate market risks. This makes it an incredibly valuable resource for the thriving startup scene in Abu Dhabi.
Abu Dhabi-based startups reap significant benefits from VARA’s mission to elevate Dubai’s status as a hub for virtual assets and related services. This ambition to bolster the local and international digital economy not only boosts Dubai but sparks innovation and business attraction across the region, notably benefiting Abu Dhabi.
The regulatory objectives set by VARA equip Abu Dhabi startups with the means to navigate the virtual asset market confidently. By focusing on investor empowerment, raising awareness about virtual asset services, and encouraging innovation, VARA presents genuine opportunities for startups to thrive.
Offering a streamlined licensing process, VARA also lays out an array of mandatory and activity-specific rulebooks, ensuring startups operate according to best practices. These guidelines, covering areas such as Broker-Dealer, Custody, Exchange, Lending & Borrowing, and more, set the standards for market compliance and chart the course for startup growth.
What’s more, VARA’s guidelines cover marketing activities for all virtual assets. It necessitates that market participants follow these marketing and promotion regulations, even if not directly licensed by VARA. This gives startups a well-defined framework for marketing their offerings, effectively targeting their audience while reducing potential risks.
The forward-thinking VARA stays resilient and progressive, constantly adapting to the ever-evolving global virtual asset industry landscape. It’s an invaluable resource that helps Abu Dhabi startups stay ahead of industry shifts.
All in all, VARA’s unique approach to virtual asset regulation offers countless advantages to startups in the wider region, including Abu Dhabi. By giving them a forward-thinking regulatory framework, VARA is fueling the growth of startups in the virtual asset sector, preparing them for lasting success in the worldwide digital economy.
VARA Business Categories
VARA has identified seven distinct categories of Virtual Assets activities, providing a comprehensive and versatile view of the Virtual Assets services landscape. This flexible list, while reflective of the current market, is designed to adapt and grow with the ever-evolving sector. It should be seen as a robust foundation for innovation rather than a set-in-stone framework. A Virtual Assets Service Provider (VASP) can apply for multiple activities under a single license, unless a specific need for segregation or requirement for independent governance is present. Notably, Virtual Assets Custody Services demand complete segregation and require a standalone license. VASPs licensed for multiple activities must adhere to the requirements for each activity at all times. Any entity, traditional or otherwise, looking to offer these Virtual Assets services must secure a license from VARA prior to operating in or from Dubai, serving either local or global customers, as long as the activity is permitted.
Virtual Assets' Advisory Services
Advisory services in the context of virtual assets involve providing personalized recommendations to clients about actions or transactions related to any virtual asset. This advice can be given at the request of the client or initiated by the entity giving the recommendation.
Virtual Assets' Broker-Dealer Services
Broker-dealer services for virtual assets encompass a range of activities. These include arranging orders for buying or selling virtual assets between two entities, accepting orders and currencies or other virtual assets for those orders, facilitating transaction matches between buyers and sellers, and dealing in virtual assets transactions on behalf of the entity. They may also involve making a market in virtual assets using client assets, or providing services related to the issuance of virtual assets.
Virtual Assets' Custody Services
Custody services for virtual assets refer to the safekeeping of these assets on behalf of another entity. These services act only upon instructions verified from or on behalf of such an entity.
Virtual Assets' Exchange Services
Exchange services for virtual assets include conducting exchanges, trades, or conversions between virtual assets and currency, or between different virtual assets. They also involve facilitating transaction matches between buyers and sellers, maintaining an order book to support these activities.
Virtual Assets' Lending and Borrowing Services
Lending and borrowing services for virtual assets involve executing contracts under which a virtual asset is transferred or lent between parties. The borrower is obliged to return the same asset either during or at the end of the agreed period.
Virtual Asset Payments and Remittances Services
Payments and remittances services for virtual assets involve receiving these assets for the purpose of transmitting or transferring them from one entity to another, or from one virtual asset wallet to another.
Virtual Asset Management and Investment Services
Management and investment services for virtual assets refer to acting on behalf of an entity in managing, administering, or disposing of that entity’s virtual assets. This might include investment management services or managing virtual assets generally, and taking responsibility for ‘staking’ virtual assets to earn fees or other payments to validators and/or node operators of a ‘proof-of-stake’ Distributed Ledger Technology (DLT).
VARA Licence Types
VARA MVP Provisional:
| Services | Virtual Assets Companies |
|---|
| Advisory Services | Universal Digital (AEDU), Aquanow |
| Broker-Dealer Services | MidChains, CoinMENA, Scallop, Universal Digital (AEDU), Aquanow |
| Custody Services | Universal Digital (AEDU) |
| Exchange Services | Bybit, Equiti, Huobi, OKX, Universal Digital (AEDU) |
| Lending & Borrowing Services | Universal Digital (AEDU) |
| Payments & Remittances Services | Zamp |
| Management & Investment Services | BRE Holdings, Brevan Howard, Fintonia Group, NineBlocks, NOIA Capital, Atremo Digital, FZEQ9 Capital, Universal Digital (AEDU)Aquanow |
MVP Preparatory:
| Services | Virtual Assets Companies |
|---|
| Advisory Services | |
| Broker-Dealer Services | GCEX |
| Custody Services | |
| Exchange Services | Binance, Crypto.com |
| Lending & Borrowing Services | |
| Payments & Remittances Services | Binance |
| Management & Investment Services | |
MVP Operational:
| Services | Virtual Assets Companies |
|---|
| Advisory Services | |
| Broker-Dealer Services | BitOasis |
| Custody Services | Hex Trust, Komainu |
| Exchange Services | |
| Lending & Borrowing Services | |
| Payments & Remittances Services | |
| Management & Investment Services | Hex Trust (Staking Only), Komainu (Staking Only) |
FMP Operational:
| Services | Virtual Assets Companies |
|---|
| Advisory Services | - |
| Broker-Dealer Services | - |
| Custody Services | - |
| Exchange Services | - |
| Lending & Borrowing Services | - |
| Payments & Remittances Services | - |
| Management & Investment Services | - |
Number of Companies at Each Stage by Type:
| MVP Provisional | MVP Preparatory | MVP Operational | FMP Operational |
|---|
| Advisory Services | 2 | - | - | - |
| Broker-Dealer Services | 5 | 1 | 1 | - |
| Custody Services | 1 | - | 2 | - |
| Exchange Services | 5 | 2 | - | - |
| Lending & Borrowing Services | 1 | - | - | - |
| Payments & Remittances Services | 1 | 1 | - | - |
| Management & Investment Services | 10 | - | 2 | - |
List of VARA Licensed Companies:
- Aquanow
- Atremo Digital
- Binance
- BitOasis
- BRE Holdings
- Brevan Howard
- Bybit
- CoinMENA
- Crypto.com
- Equiti
- Fintonia Group
- FZEQ9 Capital
- GCEX
- Hex Trust
- Huobi
- Komainu
- MidChains
- NineBlocks
- NOIA Capital
- OKX
- Scallop
- Universal Digital (AEDU)
- Zamp
The information, news, and research provided on this website is for educational purposes only and does not constitute professional advice. While every effort has been made to ensure accuracy, details may have changed since the publication of this content.
Please check the VARA website for the latest.
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