Dubai’s Virtual Assets Regulatory Authority (VARA) has released new marketing rules for companies offering virtual assets. The guidelines also include a provision for a disclaimer on the risks involved in this investment. The new rules came into force on October 1 and are intended to increase the disclosure standards and protect investors in the rapidly growing crypto market.
Mandatory Risk Disclaimer
The new rules state that any company advertising virtual assets in the United Arab Emirates (UAE) must include a disclaimer. This disclaimer must state that “virtual assets may lose their value in full or in part, and are subject to extreme volatility.” In its statement on Thursday, VARA underlined the significance of this warning. It is aimed at ensuring that the potential investors are well informed of the risks associated with such investment.
Matthew White, the Chief Executive Officer of VARA, noted that these new guidelines are crucial. White stated:
We believe that by providing clear and actionable guidance, we can help virtual asset service providers (VASPs) deliver their services responsibly while fostering greater trust and transparency in the market.
Global Regulatory Trends
This is because other countries, such as Belgium and Singapore, have also joined the fray by increasing the measures they take regarding the promotion of virtual assets. In recent years, regulators worldwide have made efforts to address the issue of ‘Crypto Advertising.’
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For instance, in the United Kingdom, “refer a friend” bonuses, which are quite popular in the industry, were prohibited last year. At the same time, Belgium now requires crypto ads to include the disclaimer: “The only guarantee in crypto is risk.”
Incentive Compliance Rules
Besides the disclaimer, any company that provides incentives for virtual assets or related products in the UAE must obtain a compliance confirmation from VARA. These incentives, such as bonuses, should not distract investors from the inherent investment risks.
By enhancing these rules, Dubai is showing the rest of the world that it is a pioneer in the virtual asset world while still safeguarding investors. The new guidelines are part of a wider strategy developed to regulate and protect the cryptocurrency environment in the UAE.
