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Dubai's virtual asset regulator, or VARA, has purchased land in the virtual reality world Of The Sandbox (SAND) as part of plans to set up a metaverse headquarters.
In a statement on Tuesday from emirates news agency WAM, VARA said the metaverse entry was aimed at facilitating "collaborative participation" between virtual asset service providers, international regulators and industry leaders. In addition, the Dubai regulator said the establishment of the "MetaHQ" office could help reach "younger licensees" into the virtual world.
"By expanding VARA's resources to a borderless audience through metaverse, Dubai is creating a prototype decentralized adjustment model, inviting international thought leaders – global authorities, governance supervisors and industry shapers – to participate, Exchange knowledge and solve collective problems so that we empower a dynamic virtual asset industry capable of building, restoring the economy, accelerating social integration and addressing environmental sustainability," said Sheikh Mohammed bin Rashid Al Maktoum, prime minister and ruler of the United Arab Emirates.
Dubai’s Virtual Assets Regulatory Authority becomes world's first regulator to make its debut in #Metaverse#WamNews https://t.co/qWUTSwvUjT pic.twitter.com/SoGth4nnpF
— WAM English (@WAMNEWS_ENG) May 3, 2022
Helal Saeed Almarri, director general of the Dubai World Trade Center Agency, added:
"Vara's acquisition of land in the Sandbox is emblematic of our confidence in the sector, and the onus is on us as the government to be a bridge that allows investors and consumers to safely accept and cooperate in scaling up the economy. In addition to bringing direct economic benefits and accelerating GDP to Dubai, VARA sees this as the first step towards joint academic and professional development among global managers, so that the international community can benefit from a virtual economy that has been allowed to scale up safely and sustainably."
The move towards metaverse comes less than two months after Sheikh Al Maktoum established the VARA and announced legislation creating a regulatory framework for cryptocurrencies in the Emirate of Dubai. Cryptocurrency law will require Dubai residents to register with VARA before engaging in crypto-related activities. Penalties for violations may include fines or suspension or cancellation of business licenses
Although many companies announced they would open offices in the metaverse after Facebook rebranded itself as Meta in October 2021, VARA was one of the first regulators to do so. On Tuesday, the U.S. Securities and Exchange Commission said it would expand its division in charge of cryptocurrency enforcement by 20 people in an effort to be "better equipped for police misconduct in the cryptocurrency market," but did not signal a similar move into the metaverse.
As an Emirate in the UAE, Dubai largely has its own laws and regulations, which operates a number of "free zones", where people can combine companies and apply for trade licenses. For example, the Dubai Financial Services Authority acts as the financial regulator for the Dubai International Financial Centre and introduces its own framework for cryptocurrencies. Binance CEO Changpeng Zhao also purchased an apartment in Dubai City in October 2021.
