MANTRA Finance FZE (MANTRA) has obtained a Virtual Asset Service Provider (VASP) license from Dubai’s Virtual Assets Regulatory Authority (VARA). This license authorizes MANTRA to operate as a Virtual Asset Exchange and to offer Broker-Dealer, Management, and Investment Services within the emirate.
A New Chapter in Regulated DeFi Services
With this license, MANTRA is likely to expand its global footprint by introducing a suite of innovative, regulatory-compliant financial products tailored to the evolving needs of investors worldwide. The company aims to scale its operations in the Middle East, focusing on the tokenization of real-world assets (RWAs).
“This license was a crucial step for MANTRA and a key step in our journey towards global expansion,” stated John Patrick Mullin, CEO of MANTRA.
John also mentioned that Dubai and VARA have become world leaders in crypto regulation by establishing the most timely, comprehensive, and built-from-the-ground-up framework for virtual assets and Web3.
Dubai’s Progressive Regulatory Landscape
Dubai has rapidly emerged as a global hub for virtual assets, thanks in large part to VARA’s comprehensive regulatory framework. Established in March 2022 under Dubai Law No. 4 of 2022, VARA is the world’s first independent regulator dedicated to virtual assets. Its mandate includes overseeing the provision, use, and exchange of virtual assets across Dubai’s mainland and free zones, excluding the Dubai International Financial Centre (DIFC).
VARA’s regulatory framework encompasses a broad spectrum of virtual asset activities, including advisory services, broker-dealer services, custody services, exchange services, lending and borrowing services, management and investment services, and transfer and settlement services. This comprehensive approach ensures that entities like MANTRA operate within a well-defined legal structure, fostering innovation while safeguarding investor interests.
The Rigorous Path to Licensing
Obtaining a VASP license from VARA involves a meticulous two-stage process:
Initial Approval (Approval to Incorporate): Applicants submit an Initial Disclosure Questionnaire (IDQ) to the Department of Economy and Tourism (DET) or the relevant Free Zone Authority. This stage requires detailed documentation, including a business plan and information about the firm’s beneficial owners and senior management. Upon satisfactory review, an Approval to Incorporate (ATI) is granted, allowing the firm to proceed with legal incorporation and operational setup.
VASP License Application: Following the ATI, the firm must prepare and submit comprehensive documentation as guided by VARA. This includes detailed policies and procedures covering corporate governance, risk and compliance, technology infrastructure, and more. The application undergoes a thorough review process, which may involve meetings and interviews. Upon successful completion, the VASP license is issued, authorizing the firm to commence its virtual asset activities.
This stringent process ensures high standards of regulatory oversight, which means only entities meeting rigorous criteria are permitted to operate within Dubai’s virtual asset ecosystem.
MANTRA’s Strategic Positioning
With the VARA license secured, MANTRA is uniquely positioned to bridge the gap between decentralized finance and traditional finance. The company’s offerings will include innovative investment products that combine the benefits of DeFi—such as increased transparency, rapid trade settlement, and enhanced user control over assets—with the protections inherent in traditional financial systems.
MANTRA Chain, the company’s purpose-built Layer 1 blockchain, is designed to facilitate the tokenization of real-world assets. As a permissionless chain, it enables developers and institutions to seamlessly engage in the RWA tokenization space, offering advanced technology modules, compliance mechanisms, and cross-chain interoperability.
In June 2024, MANTRA further solidified its commitment to regulatory compliance and innovation by signing a Memorandum of Understanding (MOU) with Zand Bank P.J.S.C. This partnership focuses on defining clear frameworks for RWA tokenization in adherence to VARA’s guidelines, aiming to provide transparent and secure financial solutions within the UAE.
“By obtaining this license, MANTRA joins a growing community of regulated entities operating within the UAE, and we are excited to work alongside industry leaders to shape the future of virtual assets,” added Mullin.
Dubai’s Growing Virtual Asset Ecosystem
MANTRA’s licensing comes at a time when Dubai’s virtual asset ecosystem is experiencing rapid growth. As of December 2024, VARA has issued 23 VASP licenses, with notable entities such as Binance, BitOasis, and Bybit among the licensed operators. This expansion reflects Dubai’s strategic vision to become a global leader in the digital economy, attracting investments and fostering innovation in the virtual asset space.
Matthew White, CEO of VARA, mentioned that fewer than 5% of applicants have been granted a full VASP license.
This selective approach ensures that only entities meeting the highest standards of compliance and governance are authorized to operate, thereby enhancing investor confidence and market integrity.
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