A Whole New Generation
Introduction And Outline
Every morning I surf through the podcast app on my Iphone
and hunt down a podcast that spares me the time to wade through a
23 page newspaper. Today morning I came across the Financial Times
news briefing by Marc Filippino and the term he used Generation Moonshot
Investor was instantly stuck in my head
Marc described this generation to
be fearless when it comes to investing in cryptocurrencies, are willing to take
more risks and have the drive to be really rich really quick. With the rise of a
whole new generation vested in cryptocurrencies in tangent comes stricter policies and regulation by governments.
This blog sheds light on the approach the UAE government has taken towards regulating the global phenomenon
of cryptocurrencies within their nation.
UAE Approach To Regulation
The UAE being home to major tourist attractions,with the recent relaxation of
Islamic laws allowing unmarried couples to live together and having a generally
low tax rate makes it an ideal destination for foreigners and expats. This is
evidenced with the recent steps PwC s Crypto head, Henri Arslanian has taken.
Henri recently has quit Pwc and set up a digital assets fund in Dubai over Hong
Kong or singapore because of Dubais crypto opennes compared to the latter.
Crypto openness translates to the ease of getting a crypto trading license and opening up a firm
The Legal Framework
Starting off with the basics, google defines Cryptocurrency as
a digital currency in which transactions are verified and records
maintained by a decentralized system using cryptography,rather than by a
centralized authority.The purpose of crypto regulation is to protect
investors prevent fraud, and reduce speculation among crypto assets encouraging higher
confidence among potential investors . The UAE regulatory framework is divided in three area
segments; the Central bank, Dubai and Abu Dhabi and these are explained followingly
The Central Bank of the United Arab Emirates issued the Stored Value Facilities Regulation on
30 September 2020. This regulation mainly deals with Stored value facilities but also recognizes
cryptocurrency and that they may be used as a stored value when purchasing other goods and services.
Additionally, in Dubai there is an establishment of Dubai Virtual Assets Regulatory Authority (VARA)
under Law No. (4) . Law No. (4) is applicable throughout the emirate, including special development
zones and free zones, but not Dubai International Financial Centre.VARA was set up to fulfill the aims
of Law No.4 and does so by Organizing issuance and trading of virtual assets and virtual tokens ,
Ensuring the highest standards of protection for beneficiaries’ personal data , Monitoring transactions
and preventing price manipulation of the virtual assets and much more.
Finally, in Abu Dhabi, The UAE s Securities and Commodities Authority has published The Authoritys
Chairman of the Board of Directors Decision No. (21/R.M) of 2020 Concerning the Regulation of Crypto Assets
The SCA s Decision explains the SCA s licensing regime for anyone who wishes to offer crypto
assets within the UAE.The regulations application extends to “any other financial activity”
in the UAE relating to cryptoassets and has the potential to capture cross-border activity involving
persons within the UAE
