Dubai’s Virtual Assets Regulatory Authority (VARA) has set a June 19 deadline for virtual asset service providers (VASPs) to comply with Version 2.0 of its activity-based Rulebooks. The updated regulatory framework emphasizes strengthening crypto market integrity and improving risk oversight within Dubai’s growing cryptocurrency ecosystem.

Key Updates in VARA Rulebook Version 2.0

The newly released Version 2.0 introduces enhanced compliance measures across various activities, including advisory services, broker-dealer operations, custody, exchanges, lending and borrowing, asset management, and transfer and settlement services.

What’s New?

  • Enhanced controls on margin trading: Stricter requirements aim to minimize risks associated with leveraged trading.
  • Token distribution regulations: Clearer guidelines ensure transparency in token-related activities.
  • Collateral wallet arrangements: Definitions have been standardized to improve operational clarity.
  • Compliance obligations: Uniform rules now apply across all licensed activities to streamline regulatory adherence.

VASPs have been granted a 30-day transition period to implement the necessary changes. During this time, VARA’s Supervision Teams will actively assist licensed entities with activity-specific compliance.

“Our commitment remains to ensuring that innovation and compliance go hand in hand. These rulebook updates reinforce the foundations of a responsible, scalable ecosystem,” said Ruben Bombardi, General Counsel and Head of Regulatory Enablement at VARA.

Strengthening Crypto Market Integrity

VARA’s introduction of Rulebook Version 2.0 aligns with its broader mission to foster a secure and well-regulated virtual asset environment. The authority has been actively taking measures to protect investors and ensure the sustainability of the cryptocurrency market.

Last October, VARA penalized seven crypto entities operating without proper authorization, issuing fines ranging from 50,000 to 100,000 AED. These firms were also ordered to cease operations and stop promoting virtual asset services. Such enforcement actions demonstrate VARA’s dedication to maintaining a compliant and transparent ecosystem.

Upcoming Requirements for Crypto Whales

Further bolstering its regulatory efforts, VARA announced earlier this year its plan to mandate the disclosure of crypto whale identities. This move will require VASPs to report the real-world identities of major token holders, adding an additional layer of accountability to the industry.

Dubai continues to position itself as a leading global hub for cryptocurrencies and virtual assets, balancing innovation with robust regulations to protect investors and promote market stability.

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