Dubai strengthens its leadership in the regulation of digital assets and Web3. The Virtual Assets Regulatory Authority (VARA) has signed a memorandum with the peaq blockchain, which specializes in DePIN infrastructure.
The joint initiative aims to create legal rules for on-chain robots, tokenized machines, and artificial intelligence interacting in a blockchain environment.
VARA and peaq are building the foundation of a new digital era
The agreement provides for the preparation of recommendations for startups wishing to obtain a VARA license, the launch of educational programs, and the exchange of technological solutions.
The main element of the partnership will be an experimental zone on the peaq blockchain, the launch of which is expected in the summer of 2025. Real scenarios of interaction between decentralized networks, AI, and machines will be tested there while complying with regulatory requirements.
The co-founder of peaq noted that the project brings together the efforts of businesses, developers, and regulators to create an environment where the machine economy can develop safely and legally, benefiting all participants.
What is peaq and how does DePIN work
People and machines on peaq
Peaq is a layer-one blockchain designed specifically for the machine economy. It allows devices—from drones to sensors—to own digital assets, exchange data, and receive rewards for completed tasks.
The DePIN (Decentralized Physical Infrastructure Network) technology connects physical objects to the blockchain through tokenization of real assets. Thus, devices become full-fledged participants in the network, capable of generating income and storing data on-chain.
VARA strengthens Dubai’s status as a regulatory center
Founded in 2022, the VARA authority is responsible for licensing and supervising crypto projects in the UAE. Agency head Matthew White stated that the regulator’s goal is to make Dubai ‘the global benchmark for safe and sustainable digital asset regulation.’
The partnership with peaq continues the course of creating a regulatory framework for tokenized assets. A week earlier, VARA signed an agreement with DMCC on the regulation of tokenized commodities, which became part of a broad strategy to standardize the market.
Rule harmonization and international integration
In spring 2025, VARA updated requirements for virtual asset service providers, allowing the issuance and trading of RWA on secondary markets.
In the summer, the agency synchronized licensing with the Securities and Commodities Authority (SCA), ensuring the validity of permits throughout the UAE.
In September, the country joined CARF, signing the Multilateral Competent Authority Agreement (MCAA) for the exchange of tax information on digital assets. The first data exchanges between countries are planned for 2028.
The UAE becomes a magnet for capital
Thanks to flexible regulation and tax incentives, the UAE is strengthening its position on the global crypto capital map. According to Henley & Partners, about 9,800 wealthy investors will relocate here by 2025, many of whom represent the fintech and blockchain industries.
Members of the DeFi Technologies board predict that in the next five years, digital assets will become the country’s second most important economic sector after energy.
What’s next?
The VARA and peaq partnership could become a key step towards creating a legal foundation for a new form of economy, where AI, machines, and blockchain operate as a single system. This project strengthens Dubai’s position as a technological and regulatory center setting standards for the entire industry.
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