Dubai has taken yet another critical step to seal its status as a well-regulated hub for crypto-related activities. This time around, Dubai adopted stricter marketing guidelines for crypto investments.
Dubai’s Virtual Assets Regulatory Authority (VARA) recently updated its marketing guidelines for digital assets to require crypto-related firms to include a disclaimer clarifying the inherent risks of such investments being marketed.
Dubai’s Virtual Assets Regulatory Authority (VARA) Updated Its Marketing Guidelines
On Thursday, September 26, Dubai’s digital asset regulator, VARA, announced an update to its Marketing Guidelines for digital assets and crypto-related activities to include stricter rules.
The new update requires crypto-related service providers to disclose the risks involved in trading digital assets in their promotional or marketing materials.
The guideline added that this will better inform investors and traders about the inherent volatility of crypto assets, which is a step towards safer crypto practices.
Hence, firms offering crypto services must now include disclaimers in their marketing materials highlighting the risks of virtual asset investments.
Aside from specific disclosure requirements, the new regulations also cover other marketing aspects like appropriate language usage and ethical marketing considerations.
A Giant Leap Towards Ethical Marketing
According to the announcement, starting from Tuesday, October 1, 2024, all digital assets service providers and crypto-related marketing firms in Dubai must include a bold disclaimer saying, “Virtual assets may lose their value in full or in part, and are subject to extreme volatility,” in their online and offline promotions, irrespective of their regulatory status.
Earlier this month, Dubai granted Standard Chartered the license to offer crypto-assets custody services to residents in the UAE. Also, the Bybit crypto exchange secures a provisional crypto license from Dubai’s regulator, the Virtual Assets Regulatory Authority (VARA).
As declared by VARA, all local and offshore crypto-related firms are required to give accurate information in their promotional materials, in addition to the disclaimer, to ensure investors or traders make informed investment decisions.
The new update to the marketing guideline is meant to improve integrity and transparency in crypto marketing in the region.
VARA emphasized that the new guideline is binding on all crypto service providers operating in the area, and anyone who tries to violate the new rules by misleading investors with false information will face severe penalties.
Dubai Is Not Alone
The recent update to its Marketing Guidelines is one of Dubai’s comprehensive regulatory frameworks towards digital assets.
Dubai began to explore crypto regulation in 2023 when VARA introduced a comprehensive regulatory framework to establish a structured approach to the use and treatment of crypto assets.
However, Dubai is not alone.
Financial watchdogs in countries like Singapore and the UK have taken similar approaches to tighten crypto marketing rules and curb the spread of misleading information to protect crypto investors and traders from making uninformed investment decisions.
Late last year, the UK’s Financial Conduct Authority (FCA) published its guidelines for crypto marketing.
The guideline stipulated that all crypto-related firms must register for self-approval of financial promotions and advertisements and also upgrade their platforms to allow new clients to have at least 24 hrs to reconsider their investment decisions.
Crypto companies, such as Nexo, Luno, Coinbase, Bybit, Binance, and PayPal, were affected by the new rule.
