Dubai's crypto landscape is undergoing a transformative phase, but amidst the buzz, smaller players are grappling with hefty regulatory burdens. Matthew White, CEO of Dubai's Virtual Asset Regulatory Authority (VARA), is on a mission to change that narrative.

In an exclusive revelation at the Paris Blockchain Week, White unveiled ambitious plans to alleviate the compliance costs plaguing small crypto entities.

At a regulatory panel discussion at the Paris Blockchain Week, White admitted that crypto regulations are not perfect, adding that he is looking for ways to improve them.

One of the plans under consideration is lessening the financial burdens for smaller crypto businesses. White said:

“It’s not perfect. There’s a number of things I’m looking at, at the moment, to try and make the regime fit for everybody. One of those is figuring out a way to deal with the costs of compliance for smaller entities.”

The VARA official said getting regulated is a “costly exercise” and that many people lack the resources. White said this was something the watchdog had experienced, leading them to look for solutions.

White explained a potential fix, where larger participants could “host” smaller ones. With this structure, costs would be carried by entities with more resources. He explained:

“The cost of compliance is borne by the larger systemic players, and this allows the smaller players to come into the ecosystem, be regulated, but also not have to suffer the same sort of level of costs of compliance that we’ve got.”

The VARA CEO also said that looking at things like this is part of the regulator’s journey of allowing innovation while creating regulations. The official said that they are continuing to engage with the industry to try to understand it.

“It moves so quickly. We don’t pretend to know everything as a regulator,” he added.

Last year, White replaced former CEO Henson Orser at VARA. On Nov. 16, VARA announced that White’s appointment was part of its preparations to ramp up to full-scale market operations.

The leadership switch came as the United Arab Emirates tightened its rules and imposed fines for unlicensed virtual asset service providers.

On Nov. 8, United Arab Emirates regulators collaborated in a joint guidance for VASPs, detailing fines and sanctions for non-compliance.

Source : Cointelegraph by Ezra Reguerra / Apr 11, 2024