Dubai consolidates its status as the Web3 world capital

DUBAI, 2nd August, 2022 (WAM) — The recent launch of Dubai’s Metaverse strategy by Crown Prince and Chairman of the Executive Council of Dubai, His Highness Sheikh Hamdan bin Mohammed bin Rashid Al Maktoum, positions the city as a global pioneer offering the world’s most advanced and connected ecosystem where the metaverse community can thrive in a dynamic and nurturing environment.

This decision consolidates Dubai’s status as the world capital of advanced technologies, mainly artificial intelligence (AI) and Web3.

Dubai is already home to over 1,000 metaverse and blockchain companies. As the city attracts new players, the sector’s current contribution of US$500 million to the economy is expected to increase significantly. The Dubai Metaverse strategy aims to support over 40,000 virtual jobs by 2030 and add $4 billion to Dubai’s economy over five years.

The emirate is making rapid progress with its metaverse strategy, announcing the formation of a Higher Committee for Future Technologies and Digital Economy chaired by Sheikh Hamdan. The committee’s objective is to consolidate Dubai’s status as a global hub of the digital economy.

The committee will design policies, analyze trends and oversee the implementation of strategies related to the digital economy and future technologies, including Metaverse, AI, Blockchain, Web3, Virtual Reality (VR), augmented reality (AR), Internet of Things (IoT), data centers and cloud computing.

The Dubai-based Virtual Assets Regulatory Authority (VARA) has formulated a Test-Adapt-Scale model that has proven to be a compelling proposition for businesses in the global economy of the future. The model is a magnet for high-value, technology-focused companies migrating to Dubai. The city seeks to become a top 10 metaverse economy and a global pioneer in the adoption of digital solutions, aiming to increase the number of blockchain companies fivefold.

Important players moving to Dubai to join the exclusive VARA regime open to a limited number of licensees include some of the world’s largest and most credible virtual asset exchanges such as Binance, FTX, crypto .com, Coinbase and Bybit. This is in addition to traditional finance icons offering DeFi (decentralized finance) solutions like Galaxy Digital, Komainu and Brevan Howard, native crypto service providers and local virtual asset companies like BitOasis and CoinMENA.

Experts envision Web3 as the decentralized and democratized version of Web2, the current iteration of the Internet. Many believe it will include “publicly owned” social media platforms, search engines and marketplaces, replacing the current “company owned” format.

Dubai metaverse leadership is the first and only jurisdiction in the world to have the foresight to implement a dedicated regulator for virtual assets. In March this year, the Vice President, Prime Minister and Governor of Dubai, His Highness Sheikh Mohammed bin Rashid Al Maktoum, approved the Dubai Virtual Assets Act (VAL) and established the VARA, firmly cementing the leadership of Dubai in the area. The law provides much-needed investor protection, economic security and market transparency, backed by fully traceable and indelible transaction records.

The Managing Director of the Dubai World Trade Center Authority, home to VARA, Helal Al Marri, said: “Virtual assets are transforming the financial world and are expected to be the main drivers of the future global economy. The VARA regime is structured to catalyze collaboration and prioritize the protection of the public”.

Dubai is a pioneer in several new era business sectors like FinTech and e-commerce. The Economist’s Digital Cities Index 2022 ranks Dubai first in the Middle East and 18th globally. Within the index, Dubai is in the Top 10 for digital finance.

Since its inception, VARA has worked to forge a favorable ecosystem and identify a very selective list of global participants among the hundreds of industry players it attracts.

It is made possible by partnerships with some of the most recognized players in the world like Chainalysis, Elliptic, AnChain and Coinfirm. Financial services firm Fintonia Group, crypto-trading app OKX and digital brokerage GCEX recently announced their launches in Dubai after receiving provisional virtual asset licenses from VARA.

For its part, OKX, has joined its global peer-to-peer exchanges to move its regional headquarters to Dubai. At the same time, Fintonia plans to expand its team in Dubai and provide bespoke cash and balance sheet management services to Token Foundations, Protocols, Bitcoin miners and other large digital asset holders. , the company said.

Piecing together the regulatory puzzle With VARA and VAL, Dubai is now at the forefront of the virtual asset industry and continues to play a vital role in its growth, evolution and regulatory future.

Part of the political and regulatory puzzle, the Dubai Strategy and Metaverse and the Dubai Blockchain Strategy aim to position Dubai as a global center for evolving technologies. The Dubai Blockchain Strategy is one of many initiatives with 24 blockchain use cases currently being implemented across eight key industry sectors including finance, education and real estate.

The industry has seen an increase in institutional and individual capital. Within digital assets, the crypto market is growing particularly rapidly. Total trading volume grew to $15.8 trillion in 2021, up 567% from 2020 totals, according to Chainalysis. Research firm Technavio expects the global NFT market size to grow by $147.24 billion between 2021 and 2026 at a CAGR of 35.27%.

With many of Web3’s leaders and up-and-coming start-ups moving to Dubai, the city is also attracting the world’s brightest talent in this field.

The ecosystem of virtual assets in Dubai The emirate is home to three free zones dedicated to the Web3 and crypto ecosystem: the Dubai World Trade Center (DWTC), the Dubai International Financial Center (DIFC) and the Dubai Multi Commodities (DMCC Crypto).

DMCC Executive Chairman and CEO Ahmed bin Sulayem said, “Digital assets are playing an increasingly important role in DMCC’s mandate to drive commerce across Dubai. Today, it is home to more than 400 of the UAE crypto companies – more than a third – the DMCC Crypto Center offers a comprehensive ecosystem to facilitate the development and adoption of crypto and blockchain technologies.”

As a relatively new free zone established in 2015, DWTCA’s regulatory and competitive operating environment is designed to facilitate the growth of the virtual asset ecosystem in Dubai. VARA, responsible for the licensing and regulation of the virtual asset industry in the mainland and Dubai Free Zone territories (excluding DIFC), is linked to the DWTC Authority, which aims to become a dedicated area for regulated virtual asset businesses.

The Dubai Financial Services Authority (DFSA), the DIFC free zone regulator, oversees the regulation of investment tokens, but does not regulate any other type of crypto assets, including cryptocurrencies, virtual assets or digital assets.

Hub for high-potential, forward-looking businesses Dubai’s location as an innovation hub connecting East and West allows it to offer unrivaled access to the fastest-growing economies. fastest in the world.

A traditional global financial center, Dubai is well equipped as a safe and highly regulated conduit for billions of dollars of transactions between East and West.

Dubai now also hosts major industry events such as ETHDubai and Binance Blockchain Week, which saw hundreds of international Web3 entrepreneurs, experts and enthusiasts participate in fireside chats and panel discussions in March. of this year.

Scheduled at the Museum of the Future in September this year, the Dubai Metaverse Assembly will bring together regional and international experts in Dubai. Over 300 global experts, policy makers, thought leaders and decision makers from over 40 organizations will explore how breakthrough Metaverse technology can be deployed in vital sectors to create a better future and quality of life for humanity.

With Dubai now home to a large community of innovative start-ups shaping the future of finance, it has embarked on a new mission to conquer the new economic frontier. Its continued technological advancements and infrastructure investments are expected to maintain its status as the Web3 capital of the world.

Translated by: Mervat Mahmoud.