The role of the UAE government in regulating and promoting the metaverse

According to a forecast by Precedence Research, the global metaverse market is already worth $100 billion and is expected to reach $ 1.3 trillion by the decade’s end. To capitalize on the growing industry and to promote the metaverse in Dubai, the UAE government has established The Dubai Virtual Assets Regulatory Authority (VARA). This makes the institution the first regulator in this metaverse development, and a headquarters called “The Sandbox” has been established.

With this start, the UAE government’s metaverse regulation via VARA has several objectives to position the Emirates in this market. In doing so, it is lined up to corroborate that the regulator is providing metaverse development solutions accessible to its sector in the environment and thus facilitating services and collaboration with other institutions. These include Virtual Goods Service Providers (VASPs), Industry Thought Leaders, and International Regulatory Authorities.

The government of Dubai has been promoting Metaverse in UAE for developing the virtual asset industry and establishing a new safe, progressive operational framework. The city administration has expressed confidence in the institution to make virtual assets a step in the future digital economy. This measure aims to make the emirate the world capital of virtual assets.

This measure is deliberated to ensure the investors that the Dubai government will protect their assets for the foreseeable future. In addition, the government’s metaverse policy in UAE will also regulate the guiding principles of the services and activities offered by this online world owing to technological evolution.

In its press release, broadcast on WAM (the official news agency of the government of Dubai), with its representative, Crown Prince Hamdan bin Mohammed, presented its draft “Dubai metaverse strategy.” The metaverse development approach is unprecedented. Indeed, it is the first state reform that intends to create the infrastructures to — govern a virtual space.

Also, the government encourages the development of the Metaverse business sector. The latter then instituted a political strategy aimed at boosting the economy of the Web 3 sector locally. The main lines can be summed up in these few points mentioned in the Dubai press release:

• Create 40,000 virtual jobs;
• Investing $ 4 billion in the Metaverse;
• Multiply by five the number of blockchain and metaverse companies (development accelerator and incubator for Web 3 startups);
• Develop the use cases and applications of the Metaverse within the government;
• Promote the deployment of a 5G network to accommodate the necessary blockchain infrastructures.

What does the UAE government aim for in the future?

The Dubai Metaverse supports the development of Web3 technology and its applications to create new models of government metaverse initiatives that work and result in vital sectors, including tourism, education, retail, remote work, health, and the legal industry. The strategy also aims to develop global standards in building safe and secure platforms for users and to develop metaverse infrastructure and regulations that will help to accelerate the adoption of these technologies.

Let’s see below how Metaverse will change Dubai’s landscape and create new infrastructure and change the practices of fellow citizens:

Encourage innovation

Dubai has a history of seizing innovation, having already attracted 1,000 companies to the blockchain and Metaverse space. They are making it more likely to understand that building the imperative infrastructure and fostering a healthy ecosystem around this emerging industry can be profitable in terms of the city’s overall metaverse economy.

Citi released a report estimating the size of the Metaverse market to be between $8 trillion and $13 trillion, which means that many businesses and jobs may exist in Dubai. The strategy aims to foster innovation in blockchain and Metaverse technologies and set standards for investors and users. Dubai’s state news agency, WAM, also highlighted its mission to provide training for developers, creators, and users hoping to transition to the Metaverse, which is critical to creating the experiences needed to attract users to (and enable them to use) new platforms.

Settlement determination

Part of this mission is also to implement the relevant UAE government metaverse regulation to help create and adopt new technologies and services. However, determining which regulations are the right ones has been one of the primary debates, especially around cryptocurrencies and blockchain technologies.

In March 2022, Dubai launched the Virtual Assets Regulatory Authority (VARA) and passed its initial law dealing with assets. The city has already granted licenses to major crypto exchanges like Binance, eToro, Evest, Kraken, Coinmama, and BitOasis. Facing increasingly restrictive regulation by other governments, businesses, and blockchain companies have strong incentives to locate in crypto-friendly places like Dubai. Bybit has announced that it will soon open its global headquarters in Dubai. Other players in the industry, like Crypto.com, have said they will establish a presence in the city.

Integrate Metaverse technology for smart cities

Significant companies in Dubai are starting to integrate Metaverse and blockchain-based technologies into their business. Notable examples include:

• Emirates Airline
• The business conglomerate Damac Group
• The fashion house Roberto Cavalli
• UAE healthcare company Thumbay Group plans to launch a “Metaverse Hospital” where patients can see doctors virtually

The Dubai Museum of the Future hosted the Dubai Metaverse Assembly in September, which brought together more than 300 experts and 40 organizations to discuss the Metaverse and its opportunities.

The Government of Dubai has many options for integrating Metaverse technologies and strengthening entrepreneurship alongside innovation. As AR technology refines, Dubai can integrate immersive experiences into public infrastructure. Facilities such as bus stops and public restrooms can be marked in the user’s field of vision. The government may build a low-resolution digital facsimile of the city, overlay storefronts, roads, and historical monuments with important information or educational content that can explain the history of the memorial, for example.

Public sector officials, especially city officials, can contribute more to the Metaverse. There are numerous ways immersive technology and blockchain can deliver value to the public. By way of public infrastructure, they can help shape the regulations needed for industries to expand. For instance, adding a QR code to a public art installation steers to a mobile AR experience or changing the national monetary system from fiat currency to crypto. -currency.

The approach proposed by the Government of Dubai is avant-garde. Some questions remain unanswered, particularly regarding the accessibility of this Metaverse to the general public and the rules that will govern it. Nevertheless, VARA’s approach remains remarkable: it is a first. Dubai confirms the trend and has become the new El Dorado for blockchain and metaverse companies. It will be interesting to see what future cities will look like. Dubai is well on its way to realizing this vision.

Make your Choice Today!

The UAE metaverse market potential is multiplying and uniting thousands of users daily via real places of life, consumption, entertainment, learning, and communication. The possibilities for UAE’s metaverse innovation remain endless, and many new applications are expected to emerge in the years to come. If you want to start metaverse software development, connect with the top companies in Dubai today.