In a significant move, the United Arab Emirates (UAE) has officially classified virtual assets (VAs) in the same category as traditional financial services. This decision comes as a part of the country’s efforts to regulate and legitimize the use of digital currencies within its borders.
Ankita Dhawan, a senior associate at Métis Institute, a dispute resolution think tank, commented on the development, stating that “The UAE has essentially classified virtual assets in the same bucket as traditional financial services – several of which are already exempt from VAT. This legitimizes VAs.”
This move is expected to provide greater clarity and regulatory certainty for businesses and individuals involved in the trading and use of virtual assets in the UAE. It also signals a growing acceptance of digital currencies as a legitimate form of financial transaction in the region.
With this new classification, virtual assets are likely to enjoy similar exemptions and benefits as traditional financial services, further encouraging their adoption and use in the UAE’s rapidly evolving financial landscape.
