As the virtual asset industry continues to evolve and gain prominence, regulatory authorities play a crucial role in establishing a secure and transparent environment for both issuers and investors. In the dynamic landscape of virtual assets, regulatory compliance is crucial for issuers looking to offer tokens or virtual assets to the public.  The Virtual Assets Regulatory Authority of Dubai, known as VARA, has established a set of regulations to ensure transparency, investor protection, and the overall stability of the virtual asset industry. Virtual Assets issuers seeking to issue tokens or virtual assets must ensure compliance with VARA’s regulations, including the requirement to provide a detailed whitepaper. 

This article aims to guide virtual asset service providers on the essential elements their whitepapers must include to comply with VARA’s Virtual Assets Issuance Rulebook, and the Virtual Assets and Related Activities regulations of 2023. As a UAE-based lawyer familiar with VARA’s regulations, I aim to shed light on the importance of complying with VARA’s requirements and help in meeting the whitepaper obligations prescribed by VARA’s virtual asset issuance rulebook. 

As a partner at CRYPTOVERSE Legal Consultancy, we are here to assist blockchain, web3, and crypto start-ups in meeting these requirements and launching their virtual assets without any complications.


VARA’s virtual asset issuance rulebook outlines the essential elements that must be included in a whitepaper. Compliance with these requirements is crucial for several reasons. Firstly, it demonstrates the issuer’s commitment to transparency and accountability, which are essential in gaining the trust of potential investors. Secondly, adhering to VARA’s regulations helps mitigate regulatory and compliance risks, ensuring a smooth token issuance process and avoiding penalties, fines, or legal complications. Lastly, by complying with VARA’s guidelines, token issuers can position themselves as responsible market participants and contribute to the overall growth and development of the virtual asset industry in Dubai, UAE.


  1. Detailed Description of the Issuer and Entities Involved.

The whitepaper must provide a comprehensive overview of the issuer and the main entities involved in the design, development, offering, or marketing of the virtual asset. This includes disclosing whether any individuals associated with the token issuer have been convicted of offenses related to dishonesty, fraud, financial crime, or violations of company, banking, insolvency, money laundering, or insider dealing laws. Additionally, ongoing inquiries or investigations must be disclosed to the extent permissible under applicable laws. These disclosures demonstrate transparency and build trust among potential investors. Such transparency promotes investor confidence and helps evaluate the credibility of the token issuer.

  1. Description of the Virtual Asset.

The whitepaper should provide a thorough description of the virtual asset, including its features, uses, and other characteristics. Clear and concise explanations enable potential investors to understand the value proposition and potential benefits of the virtual asset. By providing a clear understanding of the virtual asset’s nature and purpose, issuers enable investors to make informed decisions.

  1. Rights and Obligations Attached to the Virtual Asset.

A detailed account of the rights and obligations attached to the virtual asset is crucial. The whitepaper must outline the rights and obligations associated with the virtual asset to be issued. This includes any voting rights, entitlements to rewards or value in kind, and other financial or non-financial interests. Furthermore, the procedures and conditions for holders to exercise these rights should be clearly explained. Investors should have a clear understanding of what they are entitled to and how they can participate in the governance of the virtual asset. Transparent disclosure of rights and obligations enhances investor confidence. 

  1. Planned Use of Proceeds.

If applicable, the whitepaper must outline how the issuer plans to utilize the proceeds or consideration received from issuing the virtual asset. This includes the allocation of fiat currencies, tangible assets, or other virtual assets. Such transparency ensures that investors are aware of how their investments will be utilized. By providing transparency on the use of funds, token issuers can establish credibility and accountability.

  1. Issuance Structure.

A detailed description of the issuance structure is crucial for potential investors. The whitepaper must provide details on the issuance structure, including the number of virtual assets to be issued, the issuance schedule, and the allocation or retention of virtual assets by the issuer. Additionally, if other entities, such as licensed broker-dealers, will receive virtual assets, this information should be disclosed as well as the quantities to be received. Clarity in the issuance structure ensures fairness and avoids misunderstandings.

  1. Terms and Conditions.

Any terms and conditions applicable to holding the virtual assets, including periods during which the assets cannot be used or redeemed, should be clearly stated. The whitepaper must outline any terms and conditions applicable to holding the virtual assets, including any restrictions on usage or redemption. By communicating these conditions upfront, token issuers can provide transparency and avoid potential disputes. This enables investors to make informed decisions regarding their investment and understand the limitations or restrictions associated with the virtual asset to be issued.

  1. Underlying Technology.

Issuers must provide information about the underlying technology, such as which distributed ledger technologies (DLTs) the virtual asset is compatible with, and the relevant DLT-related standards used in its creation. Furthermore, details regarding custody and transfer of virtual assets should be included. This information assists investors in understanding the technological infrastructure supporting the virtual asset as well as the security measures implemented.

  1. Independent Smart Contract Audit.

If applicable, the whitepaper must disclose whether the virtual asset has undergone an independent smart contract audit and provide the date of the most recent audit. This demonstrates the issuer’s commitment to security and validates the reliability of the smart contract governing the virtual asset. This transparency assures investors that the smart contract governing the virtual asset has been thoroughly reviewed and validated for security and functionality.

  1. Issue Price and Value Determination: 

The whitepaper should disclose the issue price of the virtual asset, if applicable. Additionally, it should describe how the issuer determines the value of the virtual asset, including any mechanisms or methodologies used to calculate the redeemable value. This information can help investors to assess the potential return on their investment. Transparent pricing mechanisms instil confidence in investors.

  1. Fees and Charges.

If there are any fees or charges associated with the virtual asset, they must be clearly described in the whitepaper. This includes transaction fees, maintenance charges or storage fees, and any other costs that investors may incur. Transparent fee structures enable investors to evaluate the overall cost of owning and transacting with the virtual asset. Transparent disclosure of fees can also enable investors to assess the economic viability of the virtual asset before investing in it.

  1. Legal and Regulatory Considerations.

The whitepaper should outline any material legal or regulatory considerations relevant to owning, storing, transferring, or using the virtual asset. This includes compliance with anti-money laundering (AML) and know your customer (KYC) regulations, potential restrictions, licensing obligations as well as any local or international regulations that may impact the virtual asset. Providing this information demonstrates the issuer’s commitment to regulatory compliance and reduces potential legal risks. It can also enable investors to assess the risks and legal implications associated with the virtual asset.

  1. Environmental and Climate Impact.

VARA places significant emphasis on environmental and climate-related impacts. Therefore, the whitepaper must include a statement addressing the environmental consequences associated with the virtual asset. This demonstrates the issuer’s awareness of sustainability issues and their commitment to responsible business practices. It also provides investors with insights into the virtual asset’s ecological footprint.


  1. Point No. 1. No Issuer may exclude or attempt to exclude any form of actual or potential civil liability in respect of providing inaccurate or misleading information.


This point highlights the importance of accuracy and truthfulness in the information provided by token issuers. It prevents issuers from absolving themselves of any civil liability resulting from inaccurate or misleading information. It emphasizes the need for transparency and honesty in disclosing information related to virtual assets.

  1. Point No. 2. Issuers must publish the Whitepaper prior to making the Virtual Asset available to the public, including any offer or marketing. The Whitepaper shall remain subject to the rules set out above for as long as the Virtual Asset is available to the public.


This point requires issuers to publish a whitepaper, which is a document that provides detailed information about the virtual asset, its purpose, technology, potential risks, and any other relevant information. Requiring the publication of the whitepaper before making the asset available to the public ensures that potential investors or users have access to essential information that can help them make informed decisions. It sets a standard of transparency and accountability for issuers.

  1. Point No. 3. Whitepaper updates. Issuers must ensure the Whitepaper is accurate and complete at all times, including but not limited to making any necessary changes to the Whitepaper or publishing an updated Whitepaper. Issuers must take all reasonable steps to ensure holders of such Virtual Assets are notified of any updates prior to any changes taking effect, except that prior notification shall not be required where an Issuer needs to implement any update in response to a security or other threat or which is in the best interests of maintaining the integrity of the Virtual Asset as disclosed in the Whitepaper.


This point emphasizes the ongoing responsibility of issuers to keep the whitepaper accurate and complete. It recognizes the dynamic nature of virtual assets and the need for issuers to adapt to changing circumstances or threats. Issuers are required to inform holders of virtual assets about any updates to the whitepaper, except in cases where immediate action is necessary to address security threats or protect the integrity of the asset. Regularly updating the whitepaper ensures that holders have access to the most up-to-date information, promoting transparency and maintaining investor confidence.

Point No. 4. In the event of an update to the Whitepaper, Issuers must clearly state the date on which the Whitepaper has been updated and ensure all previous versions remain easily accessible in the same format and location in which they were initially published.


This point emphasizes the importance of transparency and accessibility. By clearly stating the date of updates and keeping previous versions of the whitepaper easily accessible, issuers enable holders to track the evolution of the asset’s information over time. It allows stakeholders to review the changes made, compare different versions, and assess the credibility and reliability of the issuer.


In summary, VARA’s Virtual Assets Rulebook and regulations highlight the significance of accurate and transparent information for virtual asset issuers. Updating the whitepaper is crucial for ensuring the ongoing accuracy and completeness of information provided to investors and users. 

Complying with VARA’s regulations and ensuring that whitepapers incorporate all the necessary elements is essential for virtual asset issuers in Dubai. By adhering to these requirements, token issuers can build trust among potential investors, mitigate regulatory risks, facilitate informed decision-making, maintain the integrity of the virtual asset market, and contribute to the growth and development of the virtual asset industry in Dubai and the UAE in general. 

As a law firm for blockchain, web3, and crypto start-ups in the UAE, we are here to provide guidance and support to virtual asset issuers, ensuring that their whitepapers meet VARA’s requirements and comply with the virtual asset issuance rulebook. Together, we can navigate the regulatory landscape and pave the way for a successful and compliant virtual asset offering or token launch in Dubai.
Our team of experienced lawyers is dedicated to helping start-ups launch their virtual assets without regulatory issues. Visit our website,, to explore the range of services we offer to token issuers in Dubai.

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