The Dubai Virtual Assets Regulatory Authority (VARA) has sanctioned 19 companies for operating without a license and for promoting services without approval. Fines ranged from AED 100,000 to AED 600,000 (about $27,000–$163,000), and several firms also received cease-and-desist notices, covering exchanges, custody services and promotional campaigns aimed at regional investors. VARA frame the action as part of a broader compliance drive to turn Dubai into a regulated centre for virtual assets.
Dubai Law No. 4 of 2022 created VARA and granted it oversight over virtual asset activity on the mainland and in the free zones. Sources put the licence fee at roughly AED 34,000, and in October 2024 VARA fined seven entities in a first round — the current action continues the same policy. Penalties now include cash fines and stop-orders; for major breaches VARA may levy up to AED 10,000,000 and forward cases that carry criminal liability, including prison terms.
VARA has also published company names during investigations, with notices citing Morpheus-group entities for weak AML controls and for activity carried out without approval. AML (Anti-Money Laundering) denotes the rules besides procedures that block money laundering and terrorist financing.
Implications for market participants
The same reports list four practical effects for investors, product teams or compliance staff. First of all, the entry and compliance cost rise. Licence fees next to the scale of fines lift the operating barrier for start-ups and exchanges.
Unregulated operators shrink — stop-orders plus fines are likely to push liquidity toward licensed platforms and to raise institutional confidence.
International platforms face reputational but also legal risk. VARA’s practice of naming and fining firms sets precedents that reach across borders. Dubai’s step aligns with tighter controls as well as heavier fines in Singapore, India or Australia.
The October 2024 wave set the immediate precedent and VARA states that the compliance drive will continue. Market participants must now obtain licences besides tighten AML controls to avoid penalties and to keep access to institutional clients.
