Dubai Fines 19 Crypto Firms for Unlicensed Operations

• VARA fined 19 firms for unlicensed crypto operations and marketing violations.
• Penalties ranged from AED 100,000 to 600,000 to enforce strict compliance.
• Dubai strengthens virtual asset oversight to balance innovation and investor protection.

VARA Tightens Oversight of Virtual Asset Operators

The Virtual Assets Regulatory Authority (VARA) in Dubai has been enforcing more vigorous actions by fining 19 companies that have unofficially worked and violated the marketing laws. In an official statement on Tuesday, the regulatory authority issued cease-and-desist orders and fined between AED 100,000 and AED 600,000 (approximately $27,000-163,000). These actions highlight Dubai’s increasing focus on preserving credibility and compliance within its fast-growing virtual asset market.

According to VARA, the penalties matched the magnitude and extent of every violation.The authority warned that unlicensed activity and unauthorized promotions would not be tolerated under any circumstance. It also reminded the public that only entities with valid VARA licenses are legally allowed to offer virtual asset services in or from Dubai. Consequently, the penalized companies were ordered to halt their operations and stop marketing unlicensed services immediately.

A spokesperson, who works at VARA and is part of its Regulatory Affairs and Enforcement Division, added that enforcement is necessary to ensure trust and stability in the virtual asset ecosystem of Dubai. The message restated that VARA holds the goal of making sure that only licensed firms that have high governance and business practices should be allowed to operate in the crypto market of the emirate.

Balancing Crypto Innovation with Market Integrity

Observers in the industry remarked that the enforcement campaign is the most important step done by Dubai so far regarding cracking down on unlicensed crypto operators. The move was described by Henri Arslanian, the founder of Nine Blocks Capital, as a positive step for the global crypto ecosystem. He explains that the crackdown will help discourage the bad actors and will reward firms that comply and that it is probable that the enforcement will continue in the next several months.

In 2022, VARA was incorporated to regulate the operations of virtual assets in Dubai as a separate regime from those of the Dubai International Financial Centre. The marketing regulations by the regulator provide stringent requirements on the manner in which crypto services should be marketed in order to protect the consumers.

As a regulatory center, Dubai has emerged as a centre of digital assets, hosting some of the biggest exchanges, including Binance, OKX and Crypto.com. Nevertheless, the emirate has recently become more strict to avoid unlicensed operations and reduce financial and reputational risks. The recent activities of VARA are pointers of its interest to strike a balance between innovation and regulation to establish the city of Dubai as a responsible player in the virtual asset sector.