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At least 19 virtual asset service providers (VASPs) have been fined by Dubai regulator, the Virtual Asset Regulatory Authority (VARA) for operating without licenses or breaching marketing rules. The penalties, which range from AED 100,000 to AED 600,000 (approximately $27,000 to $163,000), mark one of the largest enforcement waves since Dubai formalized its crypto regulatory framework in 2022.
According to VARA’s official statement, the authority’s Enforcement Division has been “proactively identifying and investigating unlicensed virtual asset activity,” reinforcing its zero-tolerance stance toward operators that fail to comply. The announcement serves as a warning to crypto investors, institutions, and consumers dealing with unlicensed entities.
“Enforcement is a critical component of maintaining trust and stability in Dubai’s virtual asset ecosystem,” VARA’s enforcement division said. “These actions reinforce VARA’s mandate: to ensure that only firms meeting the highest standards of compliance and governance are permitted to operate.”
The decision underscores Dubai’s intent to position itself as a global hub for compliant digital finance while signaling to market participants that nonconformity carries tangible consequences.
The VASPs fined by Dubai regulator include both local startups and internationally affiliated firms, among them: UAEC Digital Fintech FZCO, Morpheus Software Technology FZE (FUZE), TON DLT Foundation, Gleec DMCC, UEEX Technology, Triple A Technologies, Hatom Labs, and Hokk Finance.
All 19 entities have been ordered to cease operations immediately and to stop marketing any unlicensed virtual asset services “in or from Dubai.”
VARA emphasized that penalties were calibrated to the seriousness of each breach, noting that repeated or willful violations could attract heavier sanctions, including potential blacklisting or referral to law enforcement.
In a written statement, a VARA spokesperson explained:
“Unlicensed activity and unauthorized marketing will not be tolerated. VARA will continue to take proactive measures to uphold transparency, safeguard investors, and preserve market integrity.” VARA Enforcement Division, official statement to The National
The crackdown highlights the regulator’s dual focus on market integrity and investor protection, particularly amid growing global scrutiny over illicit or noncompliant digital asset operations.
This is not the first time VASPs have been fined by Dubai regulator VARA. In 2023, the agency confirmed that the deadline for crypto firms to obtain licenses had expired, triggering a series of compliance investigations. At the time, 18 mainland-licensed firms were sanctioned for failing to align with VARA’s registration requirements under the Department of Economy and Tourism (DET).
The recent round of enforcement builds on that precedent, signaling VARA’s intent to institutionalize compliance across all virtual asset activities from trading and custody to marketing and advertising.
“Dubai wants to attract global Web3 companies, but it won’t compromise on standards,” said Ola Doudin, co-founder of regional exchange BitOasis, which became one of the first platforms to secure an operational MVP license under VARA’s framework. “This approach reassures both regulators and investors that the city’s crypto market is legitimate.”
According to Chainalysis, the Middle East remains one of the fastest-growing crypto regions globally, with the UAE ranking among the top 20 countries for digital asset adoption. The growth, however, has also drawn unlicensed operators seeking to capitalize on Dubai’s open economic environment which is a risk VARA appears determined to curtail.
Analysts suggest that the VASPs fined by Dubai regulator could represent only the first phase of a wider compliance sweep. By enforcing strict penalties, VARA aims to deter potential bad actors while maintaining Dubai’s reputation as a transparent, investor-friendly jurisdiction.
“Dubai has worked hard to establish itself as a serious financial center for digital assets,” said Dr. Sameer Al-Tamimi, fintech policy researcher at Gulf Blockchain Foundation. “VARA’s latest actions show that compliance isn’t optional as it’s a prerequisite for market participation.”
The regulator’s statement emphasized the reputational, financial, and legal risks of engaging with unauthorized entities. For consumers, this serves as a reminder to verify the licensing status of platforms before trading or investing. For institutions, it highlights the growing importance of regulatory due diligence when onboarding crypto-related partners.
Dubai’s broader Virtual Asset Regulatory Framework, introduced in 2022, establishes a tiered licensing process covering everything from custody and broker-dealer services to exchange operations and advisory functions.
By 2025, VARA plans to fully operationalize its compliance monitoring system, integrating real-time reporting and risk analytics for licensed entities which is a move that analysts say could set a global benchmark for crypto regulation.
The enforcement actions come at a time when jurisdictions from Singapore to Hong Kong are also tightening controls over digital asset service providers. The VASPs fined by Dubai regulator join a growing list of firms worldwide facing scrutiny for failing to comply with evolving licensing standards.
As Dubai strengthens its oversight mechanisms, experts predict that compliant firms could benefit from increased investor trust and access to institutional capital further legitimizing the emirate’s ambition to become the “Switzerland of crypto.”
With more regulatory clarity and firm enforcement, VASPs fined by Dubai regulator may serve as a cautionary example for the global digital asset industry: innovation thrives best where transparency, accountability, and governance are non-negotiable.
