UAE Law and Practice Contributed by: Stefan Mrozinski, Gabrielle Margerison (nee Lowe) and Arnold Krutilins, White & Case LLP
lations” (the “ICO Guidance” ). The ICO Guidance sets out the FSRA’s approach to token issuers seeking to raise funds through ICOs, and market intermediaries or operators dealing in, or offering services in, virtual tokens and crypto-assets. The ADGM’s Distributed Ledger Technology Foun - dations Regulations 2023 adds further require - ments on DLT foundations when they issue tokens. 10.5 Regulation of Blockchain Asset Trading Platforms Trading of virtual assets is regulated under the general provisions applicable to trading set out by the DFSA, the FSRA, the SCA and the VARA where the blockchain assets fall under the scope of their regulatory regimes. For further discus - sion on trading see 6 Marketplaces, Exchanges and Trading Platforms . 10.6 Staking VASPs licensed by the VARA to provide cus - tody services may also provide staking if explic - itly authorised to do so by the VARA (and the authorisation is expressly stipulated in their licence). The VARA considers staking as form - ing part of the custody services that a VASP is permitted to provide. The provision of staking from custody services is therefore considered to be a subset of the custody services activity. In the DIFC, the DFSA permits the provision of staking services by authorised firms that are authorised to provide custody, subject to certain restrictions including offering and provision only to professional clients and market counterpar - ties and providing appropriate disclosures with respect to the risks of staking. In the ADGM, the FSRA concluded its consulta - tion on regulating staking in January 2025 and is
expected to publish its conclusions and relevant rules during the course of 2025. 10.7 Crypto-Related Lending The VARA regulates the provision of lending ser - vices relating to cryptocurrencies with “lending and borrowing services” being a specific activity requiring a licence from the VARA, with the rele - vant rules being contained in the VARA’s Lending and Borrowing Services Rulebook. The Lending and Borrowing Services Rulebook stipulates the relevant policies, procedures and public disclo - sures that need to be developed and made if a VASP is providing lending services and sets out specific rules relating to client lending con - cerning client reporting and valuation, record- keeping, risk management and due diligence and client agreements. In the DIFC, the DFSA prohibits authorised firms from offering or providing any facility or service(s) that allows a client to lend crypto tokens whether to the authorised firm itself or to another person. In addition, the DFSA prohibits an authorised firm from providing a credit facility to a retail cli - ent in connection with trading in crypto tokens. In the ADGM, the FSRA concluded its consulta - tion on regulating virtual asset borrowing and lending services in January 2025 and is expect - ed to publish its conclusions and relevant rules in 2025. 10.8 Cryptocurrency Derivatives The offering of cryptocurrency derivatives is based on a review of the VARA public register which sets out various entities licensed to carry out virtual asset derivatives trading activities. The VARA regulates cryptocurrency derivatives. While the VARA has not yet issued specific derivatives-related guidance, it is expected to do so in 2025.
924 CHAMBERS.COM
Powered by FlippingBook