The United Arab Emirates (UAE) has taken a major step towards creating a unified approach to crypto regulation. The country’s Securities and Commodities Authority (SCA) and the Dubai Virtual Assets Regulatory Authority (VARA) have announced a strategic partnership aimed at streamlining rules for the sector across the nation.
The move follows last September’s announcement that the two regulators intended to work together on harmonising crypto frameworks. Under the new arrangement, Dubai-based licences will now be able to operate throughout the UAE, according to Wednesday’s statement.
A VARA spokesperson said the partnership is the official implementation of that earlier plan. “In essence, the 2024 MOU was a starting point. The current partnership is its formal and functional implementation,” they explained.
Mutual Recognition, Not Automatic Passporting
While the deal introduces a mechanism for mutual recognition of licences, it will not allow automatic “passporting” across jurisdictions. This means a virtual asset service provider (VASP) licensed by one authority can be recognised by the other, but only after meeting coordination protocols and passing regulatory checks.
“These include AML/CFT assessments, operational readiness, and supervisory alignment, ensuring that national security and compliance standards remain robust,” the spokesperson said.
Benefits for VASPs
For VASPs operating or planning to operate in the UAE, the partnership brings regulatory clarity, less duplication, and a faster route to nationwide operations. It also removes the need to navigate “separate, potentially conflicting” approval processes, reducing operational risks and speeding up market entry.
According to VARA, this unified system will also strengthen the UAE’s position as a credible, innovation-driven hub for virtual assets.
Key Mechanisms and Next Steps
The new framework includes:
- A unified VASP registration process
- Mutual licence recognition
- Real-time data sharing and joint supervision
- Cross-jurisdictional Anti-Money Laundering (AML) coordination
- A Legislative Review Committee to evaluate and improve regulations
The committee, approved by the SCA, will work with VARA to align the UAE’s crypto rules with international best practices.
Positioning the UAE as a Global Leader
Officials from both authorities see the agreement as an important milestone in the UAE’s digital asset journey. VARA CEO Matthew White described it as “a pivotal moment” in future-proofing the nation’s digital economy, while SCA CEO Waleed Al Awadhi highlighted the importance of transparency and trust in attracting investment.
