It has been reported that VARA said the metaverse entry was aimed at facilitating “collaborative engagement” between virtual asset service providers, international regulatory authorities, and industry leaders.
However, the Dubai regulator said establishing its “MetaHQ” office could help reach “younger licensees” entering the virtual world.
Sheikh Mohammed bin Rashid Al Maktoum, the Prime Minister and Ruler of the United Arab Emirates, said:
"By expanding VARA’s resources to a borderless audience through the Metaverse, Dubai is creating a prototype Decentralised Regulator Model, inviting international thought leaders — global authorities, governance custodians and industry shapers — to participate, exchange knowledge and problem-solve collectively so that we enable the dynamic virtual assets sector to build economic resilience, accelerate social inclusion and address environmental sustainability."
Helal Saeed Almarri, the Director-General of the Dubai World Trade Centre Authority, said:
''VARA’s acquiring land in the Sandbox is symbolic of our belief in this sector, and the onus is on us as government to be the bridge that allows investors and consumers to safely adopt, and collaboratively scale the economy. In addition to yielding direct economic benefit and GDP acceleration for Dubai, the VARA sees this as the first step towards shared learning and expertise development across global regulators, so that the international community can benefit from a virtual economy that has been allowed to scale safely and sustainably."
The report said that the move toward the metaverse came less than two months after Sheikh Al Maktoum established VARA and announced a law creating a legal framework for crypto in the Emirate of Dubai.
Likewise, the crypto law will require Dubai residents to register with VARA prior to engaging in crypto-related activities. Penalties for violations may include fines or having business permits suspended or canceled. Though many companies announced they would be opening offices in the metaverse following Facebook's rebranding to Meta in October 2021, VARA is one of the first regulators to do so.
Last Tuesday, the United States Securities and Exchange Commission said it would expand its division in charge of crypto enforcement by 20 people in an effort to be “better equipped to police wrongdoing in the crypto markets,” but has not signaled a similar move into the metaverse.
As an Emirate within the UAE, Dubai largely has its own laws and regulations, operating several “free zones” where people can incorporate companies and apply for trade licenses. For example, the Dubai Financial Services Authority acted as the financial regulator for the Dubai International Financial Centre and introduced its own framework on crypto.
Thus, Binance CEO Changpeng Zhao also purchased an apartment in the city in October 2021.