Dubai issues regulations governing virtual asset marketing

The Virtual Asset Regulatory Authority (VARA) in Dubai, has unveiled guidelines for the marketing and promotion of virtual assets applicable to any entity using Dubai-based media sites and publishing channels.

Dubai marketing for virtual assets

VARA this month unveiled its guidelines for new implementing regulations for the marketing and promotion of virtual assets in Dubai. The UAE city has been working hard for months to give precise regulations to the world of cryptocurrencies and Web3, of which it is becoming a truly international hub.

Dubai is home to nearly 1,000 companies in the sector, which have chosen the Emirati city as their main business headquarters. According to some figures, the cryptocurrency world in 2021 contributed about $500 million to Dubai’s economy.

According to early rumors, the guidelines approved by VARA are expected to provide a progressive framework that can enable borderless economic opportunities, without compromising market security, across the global virtual asset sector.

VARA was launched in March 2022 by Sheikh Mohammed bin Rashid, the Emir of Dubai, who announced it via Twitter:

Today, we approved the virtual assets law and established the Dubai Virtual Assets Regulatory Authority. A step that establishes the UAE’s position in this sector. The Authority will cooperate with all related entities to ensure maximum transparency and security for investors. pic.twitter.com/LuNtuIW8FM

— HH Sheikh Mohammed (@HHShkMohd) March 9, 2022

VARA’s goal was precisely to endow Dubai with a regulatory body over the entire world of digital assets, equipping the city with an institution that can monitor all players in the sector and ensure precise regulation of the market related to virtual assets.

The approved VA marketing, advertising, and promotions regulations should regulate all forms of promotion, communication, and advertising, related to the digital asset sector that can ensure a form of protection for investors and industry players. The guidelines reinforce marketing, data protection, and consumer protection laws that have been well integrated into the UAE.

VARA contributes to market development and investor protection

A report published by VARA states:

“Guidelines further detail the obligations of Dubai licensed VASPs [virtual assets service providers] and any advertising platforms that are positioning VA [virtual assets] content across traditional and new-age media channels for the Dubai market, to ensure factual accuracy, explicitly demonstrate any promotional intent, and in no way mislead on the guaranteed nature of their returns.”

These guidelines should, as mentioned above, act as a guarantee for users and operators that they are conducting business in an appropriate manner that complies with what are the laws and regulations regarding solicitation of savings, assuring customers who want to transact in digital assets.

Kokila Alagh, the founder of KARM Legal Consultants, said in an interview with a local newspaper about this decision by the Dubai regulatory authority that VARA would identify an issue of great importance to the digital asset sector:

“Marketing and promotions are the first point of contact between end users and VASPs, and these determine whether the user will engage with the service or not. It is imperative for users to have accurate and full details to make an informed decision as to their VA exposure. These regulations will go a long way in ensuring that users have the needed information before making their decisions.”

Faisal Zaidi, co-founder, and CMO of Crypto Oasis, a Dubai-based venture building company to foster the ecosystem and accelerate Blockchain-related organizations, also warmly welcomed this initiative:

“We welcome the latest announcement by VARA, as it increases the regulatory certainty in Dubai. Traditional media remains the major source of information for most consumers. Globally and in the UAE, this space has been used by many organisations to their advantage. This announcement will ensure companies in the virtual assets sector act appropriately, it will help VARA regulate communications to enforce responsibility, and protect consumers and investors.”