On the 17th of November 2023, Virtual Assets Regulatory Authority [VARA] (VARA) issued an official communication regarding the Regulatory final deadline for VASPs, which was also set for the same date.

The purpose of this market notice is to inform all VA (Virtual Asset) industry stakeholders and consumers that the designated deadline for entities to engage in the regulatory licence application process has now lapsed.

Notably, VARA has reiterated a series of advisories since Q2-2023 as well as the requirement for entities operating within the VA domain to initiate procedural engagement with VARA. Moreover, VARA called on VASPs to proactively reach out and emphasized the mandatory licensing requirement in order to avoid enforcement actions as well as regulatory consequences.
Subsequently, on the 7th of November 2023, VARA extended its final deadline for VASPs to apply for registration or submit their licensing applications until the 17th of November 2023 – a deadline which has now lapsed.

To date, fines have been imposed on 18 VASPs with commercial licenses on the mainland, operating under the purview of the Department of Economy and Tourism (DET), due to their non-compliance with VARA’s directives and regulatory guidance.

Further fines, enforcement actions and potential closure of unlicensed VASPs are anticipated should regulatory gaps persist unattended by the end of the year. Hence, entities seeking to continue to offer VA services in Dubai are urged to contact VARA expeditiously to mitigate the risk of further punitive measures.

VARA’s enforcement actions are indispensable in addressing instances of non-compliance; as the integrity of the VA market relies on the responsible market conduct of each participant.

VARA’s proactive approach establishes a robust foundation for sustained efficacy within the dynamic landscape of VAs, and fosters trust in VARA’s unique regulatory regime. This, in turn, positions the industry in alignment with best-in-class international standards, and fortifies VARA’s position in the global landscape.