Thomas Daniels
The United Arab Emirates’ Virtual Assets Regulatory Authority (VARA) has introduced a new rule requiring cryptocurrency firms to include explicit risk disclaimers in their marketing materials. Effective October 1, crypto companies marketing in the UAE must inform potential investors that “virtual assets may lose their value in full or in part, and are subject to extreme volatility,” according to a report by Bloomberg.
The updated marketing guidelines mandate that firms offering virtual assets or related incentives must obtain compliance approval from VARA. These firms must ensure that any bonuses or incentives are not used to “divert or mislead” investors from understanding the inherent risks associated with their investments.
VARA CEO Matthew White emphasized the importance of these measures in fostering trust and transparency within the crypto sector. He believes that providing clear, actionable guidance will help virtual asset service providers build credibility while operating in Dubai’s competitive market.
Dubai has emerged as a global hub for crypto businesses, bolstered by favorable tax laws and abundant venture capital opportunities. A Bitget research report anticipates that by the end of 2024, the number of crypto traders in the Middle East will grow from 500,000 to over 700,000.
Additionally, Dubai has seen significant regulatory progress. In a landmark ruling last month, a Dubai court recognized cryptocurrency as a legitimate form of payment in employment contracts. Moreover, the UAE launched the RAK Digital Assets Oasis (RAK DAO) in October 2023, the region’s first free zone dedicated to cryptocurrency, blockchain, and artificial intelligence ventures. By March 2024, over 100 entities, including India’s CoinDCX, had secured licenses to operate within this business-friendly zone.
