VARA CEO Proposes Plan to Ease Compliance Costs for Small Crypto Businesses
Summary:
Matthew White, CEO of Dubai's Virtual Asset Regulatory Authority (VARA), announced plans to mitigate compliance costs for smaller cryptocurrency businesses during a panel discussion at Paris Blockchain Week. Recognizing the imperfections of current crypto regulations, White proposed an alternative where larger entities could financially "host" smaller ones, thus bearing the compliance costs and allowing smaller players to enter the ecosystem without facing excessive expenses. White's appointment as CEO and the implementation of these plans come amidst the UAE's tightened rules and penalties for unlicensed virtual asset services.
In Dubai's rapidly evolving cryptocurrency environment, smaller outfits are suffocating under regulatory weight. However, Matthew White, the Chief Executive Officer of Dubai's Virtual Asset Regulatory Authority (VARA), aims to upend this scenario. At the Paris Blockchain Week, in an exclusive disclosure, White disclosed bold strategies designed to mitigate the grueling compliance costs that beleaguer these smaller blockchain enterprises.
At a panel discussion on regulatory matters during the Paris Blockchain Week, White conceded that existing cryptocurrency regulatory frameworks are far from perfect, and he is seeking avenues to fine-tune them. Among his blueprint of strategies is one aimed at reducing financial burden for smaller businesses in the cryptosphere. He stated, “The current situation isn’t ideal. I am exploring a range of possibilities to ensure that the regulatory system benefits everyone. One of these involves devising a strategy to cope with compliance expenses for smaller entities.” White revealed that the steep cost of getting regulated has been a deterrent for many who do not have the necessary financial resources, and they are actively seeking solutions to this issue.
One of the proposed alternatives suggested by White involves larger entities offering "host" services to smaller ones, thereby shifting the costs. In this setup, those with more financial capabilities would absorb the costs. He expanded on this, stating, “The major players in the system would bear the brunt of compliance costs, enabling smaller players to enter the ecosystem, comply with regulations, but avoid incurring excessive compliance costs.”
White also added that finding solutions such as this forms an integral part of the regulatory board’s ongoing efforts to encourage innovation while putting in place robust regulations. The authority, he explained, constantly engages with industry stakeholders to comprehend its fast-paced dynamics, admitting, “The sector evolves at a remarkable pace. As regulators, we don’t claim to have all the answers.”
White succeeded former CEO Henson Orser at VARA last year. His appointment, announced by VARA on November 16, was part of the financial regulatory authority’s readiness for operating at full scale in the market. This change in leadership occurred as the UAE strengthened its regulations and imposed penalties on unlicensed virtual asset service entities. On November 8, UAE regulators outlined guidelines for such service providers, including fines and punishments for non-compliance.
Published At
4/11/2024 3:35:25 PM
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