Although Dubai has actively promoted itself as a hub for digital assets, the Virtual Assets Regulatory Authority (VARA) has moved decisively to enforce licensing rules, announcing sanctions against 19 firms for carrying out or promoting virtual-asset services without authorization. The regulator, tasked with overseeing virtual assets across Dubai’s free zones and mainland, imposed fines ranging from AED 100,000 to AED 600,000 and issued cease-and-desist orders where appropriate, illustrating a strict approach to compliance that aims to close regulatory gaps. The actions affected a mix of global firms with UAE partnerships and local start-ups operating within free zones, showing that external affiliations do not exempt entities from VARA’s licensing requirements. VARA’s enforcement wave targeted specific operational violations, including unlicensed trading activities and breaches of marketing rules, and in some instances it required immediate cessation of promotional campaigns, reflecting concerns about consumer protection and market integrity. In at least one case, the regulator appointed a skilled person to conduct a compliance review, signaling an emphasis on remediation as well as punishment, and the public notices accompanying penalties were intended to inform both firms and consumers about the standards expected. The fines, which amounted to up to roughly $163,000 in certain instances, were calibrated according to the severity of the infractions and the scale of unlicensed operations. The implications for international firms were clear, as sanctions included companies with regional partners, such as a Singapore-based technology firm that maintained a UAE telecom partnership yet still faced penalties, underscoring that regional presence alone does not satisfy VARA’s licensing framework. VARA maintains a registry of compliant Virtual Asset Service Providers (VASPs) and requires formal licensing for legal operation, providing a pathway for entities to regularize activities within specified compliance periods. Firms operating in free zones were specifically noted as subject to the same oversight, which reduces ambiguity about jurisdictional exemptions. The regulatory posture emphasizes both deterrence and corrective action, and stakeholders are advised to assess licensing status, strengthen compliance systems, and review marketing practices, because failure to align with VARA requirements can lead to substantial financial and operational consequences. VARA’s recent actions represent VARA’s most assertive wave of enforcement in 2025. This enforcement follows a broader pattern of heightened regulatory scrutiny across UAE financial authorities. Notably, the UAE’s leadership in crypto adoption and regulatory innovation has made it a focal point for such measures in the fastest-growing crypto market.
