The application must be submitted by all VASPs operating within the country.
The United Arab Emirates (UAE) Securities and Commodities Authority (SCA), a federal financial regulatory agency, is now accepting licensing applications from companies looking to offer virtual asset services within the nation.
According to the press release shared on April 17th, all virtual asset service providers (VASPs) operating in the UAE must submit an application and acquire a license from the agency.
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This rule does not apply to companies licensed in the country's financial-free zones. On the other hand, digital asset companies functioning within Dubai must comply with the emirate's own financial regulator, the virtual asset services authority (VARA).
The UAE's Cabinet issued resolution number 111 on December 11th, 2022, to regulate virtual assets and foster an enticing financial, economic, and investment environment for global companies and institutions in "the virtual assets sector."
It is worth noting that on February 1st, SCA announced that it will start regulating the virtual asset sector in an attempt to "ensure the protection of investors' funds in virtual assets from illegal practices."
At the end of March, the UAE Central Bank has launched its Central Bank Digital Currency Strategy, which is one of the nine steps in its program to become a leading global financial hub. The first stage of the program is set to end in mid-2024.
In conclusion, the UAE's federal financial regulator's move to accept licensing applications for VASPs represents a step forward in regulating and supervising the virtual asset sector, paving the way for a secure and attractive environment for global companies and institutions.
