The UAE has taken an important step towards unifying cryptocurrency regulation. The country's Securities and Commodities Authority (SCA) and the Dubai Virtual Assets Regulatory Authority (VARA) announced the establishment of a strategic partnership to unify the cryptocurrency regulatory approach in the UAE.
In September, the two regulatory bodies expressed their intention to collaborate on unifying the country's cryptocurrency framework. According to an announcement shared with Cointelegraph on Wednesday, a key feature of this partnership is allowing Dubai's licenses to serve the entire UAE.
A VARA spokesperson told Cointelegraph that the latest developments formally establish an agreement between the two regulatory bodies and implement this intention through specific mechanisms.
"In fact, the memorandum of understanding for 2024 is just a starting point. The current partnership is its formal and functional implementation," VARA stated.
While the agreement establishes a mechanism for mutual recognition of licenses between the SCA and VARA, it does not provide automatic "passage" for cross-jurisdictional licenses.
"License mutual recognition is a key feature of the partnership, but it is not an automatic passage," the spokesperson said.
The spokesperson clarified that the agreement establishes a mutual recognition mechanism between the SCA and VARA.
This means that a virtual asset service provider (VASP) licensed by one authority can be recognized by the other. However, they will be subject to coordinated agreements and applicable regulatory checks.
"This includes anti-money laundering/anti-terrorism financing (AML/CFT) assessments, operational readiness, and regulatory consistency, ensuring that national security and compliance standards remain robust," the spokesperson told Cointelegraph.
For VASPs operating or wishing to operate in the UAE, this partnership provides regulatory clarity, reduces duplication, and offers a streamlined path for nationwide coverage.
A VARA spokesperson stated that this eliminates the need to navigate "independent, potentially conflicting" approval processes, "reducing operational risks and increasing time to market."
"This also enhances the UAE's global appeal as a credible, innovation-driven jurisdiction, adopting a unified approach to virtual asset oversight," the spokesperson added.
These mechanisms include a unified registration framework for virtual asset service providers (VASPs), mutual license recognition, real-time data sharing and joint oversight agreements, cross-jurisdictional anti-money laundering (AML) coordination, and the establishment of a legislative review committee.
The SCA approved the establishment of this committee, commissioning it to work with VARA to assess and refine the country's cryptocurrency regulation based on international best practices. This indicates both parties' commitment to building a globally competitive regulatory environment.
Officials from both regulatory bodies described this partnership as an important step in positioning the UAE as a leader in cryptocurrency governance.
VARA CEO Matthew White called the partnership a "key moment" in the future development of the UAE's digital economy. Meanwhile, SCA CEO Waleed Al Awadhi stated that transparency and trust are at the core of attracting investment.
While the recent developments represent a bilateral agreement between the SCA and VARA, the spokesperson told Cointelegraph that this is part of a broader effort to strengthen regulatory coordination at the national level in the UAE.
VARA stated that ongoing dialogue is taking place with other regulatory bodies, including the Abu Dhabi Global Market (ADGM), as well as local and international stakeholders to promote interoperability, regulatory consistency, and cross-border cooperation.
"Future collaboration remains a strategic priority," the spokesperson added.
Related: Nomura's Laser Digital to launch the first regulated OTC crypto options platform in Dubai
Original article: “Dubai and UAE Unify Cryptocurrency Regulatory Framework Under New Partnership”
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