Dubai's cryptocurrency regulatory authority has fined 19 unlicensed companies, indicating its ongoing efforts to strengthen regulation and protect investors.
On Tuesday, the Dubai Virtual Assets Regulatory Authority (VARA) announced that it had issued economic penalties and stop orders against 19 companies found to be operating outside its regulatory scope.
VARA stated that these sanctions are part of its continuous efforts to protect the rapidly growing digital asset ecosystem in the emirate and to limit the risks associated with unlicensed crypto activities.
"Enforcement is a key component in maintaining trust and stability in Dubai's virtual asset ecosystem," VARA's enforcement department stated. "These actions reinforce VARA's mission: to ensure that only companies meeting the highest compliance and governance standards are permitted to operate."
The enforcement actions were taken following a series of investigations into unauthorized operations. According to the regulatory authority, these companies were penalized for providing crypto-related services without approval and for violating VARA's marketing rules.
In 2024, VARA tightened its crypto marketing rules, requiring disclaimers to be placed on promotional materials. The regulatory authority also mandated that prior authorization be obtained before promoting products and services to citizens and residents.
At that time, VARA CEO Matthew White stated that this forced virtual asset service providers (VASPs) to "provide services responsibly," adding that it promoted market transparency and trust.
All penalized entities were required to immediately cease operations and stop promoting any unlicensed services in or from Dubai. These entities were also fined between 100,000 to 600,000 dirhams (27,000 to 163,000 USD), with the specific amount depending on the severity and scope of each violation.
"Unlicensed activities and unauthorized marketing will not be tolerated," VARA's enforcement department stated. "VARA will continue to take proactive measures to maintain transparency, protect investors, and uphold market integrity."
This move follows a similar enforcement action in October 2024, when the regulatory authority fined seven unlicensed crypto entities between 13,600 to 27,200 USD and issued stop orders for rule violations.
Nicholas McNicholas, head of VARA's enforcement department, told Cointelegraph that VARA considers multiple factors to determine the scale of fines, including the nature, severity, and impact of the violations.
Specifically regarding marketing fines, VARA also reviews all circumstances of the advertisements, including the extent and scale targeting Dubai customers. This includes any information that may suggest the relevant companies have obtained licenses.
When asked about the details of the sanctioned companies, McNicholas told Cointelegraph that all relevant details have been published on the VARA website.
He also stated that VARA has an independent appeals process. "The fined companies had the opportunity to appeal to VARA before the actions were announced," McNicholas said.
While the UAE is considered a crypto-friendly jurisdiction, Dubai's cryptocurrency regulatory authority reminds the public of its commitment to maintaining market regulation and transparency through a licensing framework aimed at "balancing innovation with strong protections for all stakeholders."
VARA added that the announcement serves as a reminder to consumers, investors, and institutions that engaging with unlicensed crypto operators poses significant legal, financial, and reputational risks. The regulatory authority reiterated that only entities licensed by VARA are permitted to provide crypto services in or from Dubai.
This move follows other regulatory developments in the region. On August 7, VARA collaborated with the Securities and Commodities Authority (SCA) to unify the country's approach to crypto regulation.
When asked if the recent enforcement actions were related to the SCA partnership, VARA told Cointelegraph that the agency works closely with the Securities and Commodities Authority and "will take joint action as necessary based on the partnership."
Related: EU plans to transfer crypto regulatory powers to ESMA to end fragmented regulation
Original article: “Dubai Virtual Assets Regulatory Authority (VARA) fines 19 unlicensed crypto firms”
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