Dubai’s Virtual Assets Regulatory Authority (VARA) has penalized 19 firms for engaging in unlicensed activities. The fines, which can reach up to $163,000, highlight the authority’s ongoing initiative to protect investors and enhance regulatory oversight in the digital asset sector.

On Tuesday, VARA revealed that the sanctioned companies were operating without the necessary approvals and violating marketing regulations. This action forms part of VARA’s strategy to ensure a secure environment for the rapidly expanding digital asset market in Dubai.

“Enforcement is a critical component of maintaining trust and stability in Dubai’s Virtual Asset ecosystem,” stated VARA’s Enforcement Division. “These actions reinforce VARA’s mandate: to ensure that only firms meeting the highest standards of compliance and governance are permitted to operate.”

Enforcement Against Unauthorized Companies

The recent sanctions follow investigations that uncovered unauthorized operations. The companies faced penalties for providing crypto services without authorization and for breaching VARA’s marketing requirements.

In 2024, VARA intensified its regulations concerning crypto marketing, mandating that disclaimers be included in promotional content and requiring firms to obtain prior permission before advertising to the public.

All fined entities must immediately cease operations and halt any promotional activities related to unlicensed services within Dubai. The fines imposed range from 100,000 to 600,000 dirhams ($27,000–$163,000) based on the severity of each infraction.

“Unlicensed activity and unauthorized marketing will not be tolerated,” emphasized VARA’s Enforcement Division. “VARA will continue to take proactive measures to uphold transparency, safeguard investors, and preserve market integrity.”

This enforcement action is reminiscent of another crackdown that occurred in October 2024, where seven unlicensed entities were fined between $13,600 and $27,200 for similar violations.

Determining Penalties

According to Nicholas McNicholas, VARA’s enforcement head, the authority evaluates several factors to ascertain the severity of fines, including the nature and impact of the violations, as well as the advertising conditions.

He noted that they implement an independent appeal process for fined firms, allowing them a chance to contest penalties before any public announcement.

Regulatory Goals

Although the UAE is regarded as a crypto-friendly environment, VARA is dedicated to maintaining stringent regulatory standards to ensure transparency and security for all participants in the digital asset market.

The announcement serves as a reminder to all consumers and investors regarding the risks associated with unlicensed crypto operations. VARA stresses that only firms certified by them can legally provide crypto services in Dubai.