Regulations: Dubai sets foot in The Sandbox metaverse

History in the Metaverse – The United Arab Emirates (UAE) continues to confirm its interest in web3 technologies. In this match, Dubai is not lagging behind† Blockchain, cryptocurrencies, metaverse: the kingdom keeps pace. Now it’s the government’s turn to set foot in the metaverse. Regulatory body VARA is taking the first step by settling in the pixelated universe of The Sandbox.

A controller at The Sandbox

Let’s look at VARA first. A government agency in Dubai, the regulator’s mission is to provide a “safe working environmentin the metaverse. By doing so, by affirming its interest in a virtual social space, Dubai aims to support the development of the blockchain:

“Virtual assets are an integral part of the future digital economy. †

VARA official press release

So, the government of Dubai wants to allow the blockchain industry to engage in it. This allows members with a VARA license to develop securely in The Sandbox:

VARA joins the metaverse and becomes the first government agency in Dubai – and the Metaverse – ushering in a new era in which the Dubai government uses modern innovations to expand its services and regulatory power (…) VARA represents a serious effort to create a powerful new economic sector that contributes to the national economy and creates new investment opportunities. This is possible thanks to the secure and modern regulatory solutions we envision. Our presence in the metaverse therefore marks the beginning of a new phase in the Dubai government’s march into the future; one that will have a positive impact in the long run.”

His Highness Mohammed bin Rashid Al Maktoum, Crown Prince of Dubai, Chairman of the Executive Council

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Specific VARA META HQ, Regulator Headquarters will open its virtual doors in The Sandbox. Still according to government statements, therefore, it is up to His Highness to place Dubai as the capital of fintech and blockchain:

Dubai maintains a leading position at the forefront of technological transformation. We’ve moved from an early adopter to an innovator and be a part of shaping the future of this technology. †

But what will VARA’s mission be in the metaverse? The regulator wants to provide a decentralized and secure commercial space for everyone. The basic principles are clear:

(…) secure cross-border interoperability, informed investor adoption, prioritization of market protection and industry accountability.”

Guardian of governance and industry shapers The VARA will offer state and government participation in exchanges, and will provide regulation in the metaverse.

The questions of economic freedom then arise. Because regulation a priori seems to conflict with any form of decentralization.

VARA META HQ already wants to answer these questions by committing itself to development and support. Meta HQ then has the following missions:

  • reach out to private sector players and provide them with a legal framework
  • provide a safe social space
  • giving access to consumer products
  • become a trusted intermediary with VASPs (PSAN equivalent in France)
  • offer promising young developers the opportunity to evolve in a safe virtual world. They can then share their knowledge and make as many people as possible aware.

In addition, the presence of the regulator offers the government a new way to generate income. Helal Saeed Almarri, Managing Director of the Dubai World Trade Center Authority, says:

“VARA’s land acquisition in the Sandbox symbolizes our confidence in this sector, and it behooves us as a government to be the bridge that enables investors and consumers to securely adopt and scale the sharing economy. In addition to generating direct economic benefits and accelerated GDP for Dubai, VARA sees this as the first step towards shared learning.”

The approach proposed by the government of Dubai is avant-garde. Some questions remain unanswered, in particular the accessibility of this metaverse to the general public and the rules that will govern it. The approach of the VARA remains remarkable: it is a first. Dubai confirms the trend and seems to be the trend new eldorado for blockchain and metaverse companies.

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