VARA Struck The Correct Balance in Regulatory Time Frame

• Sean McHugh debunked claims that VARA is too friendly with crypto regulation.
• McHugh believes the agency has struck the right balance with the approval time frame.
• VARA is at the forefront of Dubai’s crypto hub branding.

Sean McHugh, a senior official with Dubai’s Virtual Assets Regulatory Authority (VARA), pushed back against the opinion that his agency is taking a “friendlier-than-usual” approach to crypto regulation. He stated that VARA has found the correct balance in terms of time taken to award licenses to crypto-related applicants.

Dubai’s goal of becoming a crypto hub is well-known, alongside other Asian crypto centers like Singapore and Hong Kong. To achieve this goal, the region’s regulatory agency, VARA, has a key role to play, considering how regulation affects crypto development in various jurisdictions.

VARA and other regulators in the UAE, including the Abu Dhabi Global Market (ADGM), are leading the charge in branding the region and creating a welcoming environment for crypto participants. McHugh likened the VARA situation to the story of Goldilocks and the Three Bears.

Read also: Dubai Becomes a Haven for Crypto Enthusiasts Fleeing Strict US Regulation

McHugh explained that applicants to any process often think it is moving slower than it should, while those outside may think things are faster than they should. He noted that those groups are not necessarily VARA’s target audience and reiterated his belief that the agency has struck the right balance.

Agency records indicate that VARA has granted full regulatory approvals to multiple top crypto exchanges, including OKX, Crypto.com, and Binance. However, VARA has not set an outright timeframe for license approvals, even though those already approved involved months of continued interaction between the parties involved for fine-tuning.

Meanwhile, based on its existing regulation, the agency recently sanctioned seven entities for operating without the required licenses. That happened after VARA updated its rules guiding the marketing of virtual assets. 

McHugh further noted that VARA focuses on responsible licensing, supervision, compliance with anti-money laundering and terrorism financing, and customer protection.