Dubai Tightens the Screws on Crypto—New Regulations Target Wild West VASP Landscape
Dubai’s financial watchdog just dropped a regulatory hammer on virtual asset service providers (VASPs). The emirate’s Virtual Assets Regulatory Authority (VARA) unveiled stricter oversight rules—because apparently ’move fast and break things’ doesn’t fly when billion-dollar rug pulls make headlines.
Key changes? Mandatory real-time transaction monitoring, beefed-up KYC (because who doesn’t love submitting passport scans for a $50 crypto purchase), and capital requirements that’ll make some offshore operators sweat. VARA’s message is clear: Dubai wants crypto cash without the cowboy antics.
Funny how these ’light-touch’ jurisdictions always discover the virtues of regulation once their tax-haven status is secure. Meanwhile, institutional investors are already salivating—nothing gets Wall Street’s attention like governments sanitizing the crypto streets.
VARA Releases Version 2.0 of the Rulebooks
The Virtual Asset Regulatory Authority (VARA) announced the publication of Version 2 of its activity-based Rulebooks as part of Dubai’s ongoing commitment to constructing a digital asset regulatory framework that can stand the test of time. While the regulator seeks to build a regulatory framework that can withstand the future, it notes the importance of balancing innovation with “robust market safeguards.”
The updated version includes “strengthened controls around margin trading and token distribution services, clearer definitions for collateral wallet arrangements, and harmonised compliance requirements across all licensed activities.” according to the announcement the refinements are designed to promote “greater market discipline, risk transparency, and operational resilience across” Dubai’s virtual asset ecosystem.
Version 2.0 of the Rulebooks introduces an improved supervisory mechanism across eight (8) regulated virtual asset activities, including:
The VARA announced a 30-day transition period to all impacted virtual asset service providers (VASPs), requiring full compliance by June 19, 2025.
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.
