| 1. | VA issuances in the Emirate are categorised, along with the applicable requirement prior to the Virtual Asset being issued, as follows—
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| Category | Applicable types of VA issuances | Prior requirement | | Category 1 | issuance of— | (i) | Fiat-Referenced Virtual Assets (“FRVAs”); | | (ii) | Asset-Referenced Virtual Assets (“ARVAs”); or | | (iii) | other Virtual Assets as may be determined by VARA from time to time. |
| VARA Licence. | | Category 2 | Issuance of any Virtual Asset which does not constitute— | (i) | a Category 1 VA Issuance; or | | (ii) | an Exempt VA. |
| No VARA Licence required, but all placement or distribution must be carried out through or by a Licensed Distributor. | | Exempt VAs | Issuance of any Virtual Asset which does not constitute a Category 1 VA Issuance and is either— | (i) | a Non-Transferable Virtual Asset; | | (ii) | a Redeemable Closed-Loop Virtual Asset; or | | (iii) | other Virtual Asset as may be determined by VARA from time to time. |
| No requirements prior to issuance. |
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| 2. | When determining the category of a VA issuance, VARA will consider all factors it deems appropriate, including but not limited to, the—
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| | a. | nature of all Virtual Assets or types of Virtual Assets; |
| | b. | rights and/or value which the Virtual Asset represents or purports to represent; and |
| | c. | the underlying business model associated with the Virtual Asset.
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| 3. | If any change is proposed to a Virtual Asset which may result in its issuance no longer qualifying under the original categorisation in Rule I.C.1 of this VA Issuance Rulebook, the Issuer must comply with all requirements of the category under which the Virtual Asset will fall after such change has been made. The Issuer must ensure all such future requirements are met prior to any proposed change to the Virtual Asset taking effect which, for the avoidance of doubt, may include the Issuer obtaining a Licence from VARA and/or thereafter obtaining prior approval from VARA of the Whitepaper, where necessary. |