AInvest, 19 May 2025: Dubai’s Virtual Assets Regulatory Authority (VARA) issued a directive requiring licensed digital asset companies to comply with updated activity-based Rulebooks by 19 June 2025 following the release of Version 2.0 on 19 May 2025.

This update aims to strengthen market integrity and risk oversight by refining controls around margin trading and token distribution services, harmonising compliance requirements, and clarifying definitions for collateral wallet arrangements. It impacts all virtual asset service providers (VASPs) operating within Dubai, obliging them to align with the new rules after a 30-day transition period. VARA has emphasised the importance of this transition period to facilitate adaptation to the updated regulations.

The updated Rulebooks will enhance supervisory mechanisms across various regulated activities, including advisory, broker-dealer, custody, exchange, lending and borrowing, virtual asset management and investment, and VA transfer and settlement services. Key operational terms such as “client assets,” “qualified custodians,” and “collateral requirements” have been defined to ensure consistency and reduce ambiguity in compliance.

In margin trading, VARA tightened leverage thresholds and mandated clearer collateralisation standards to mitigate risks associated with market downturns. The Rulebooks also introduced new token distribution regulations, outlining licensing prerequisites, investor protections, and marketing restrictions, particularly for retail-facing offers.

For more news and content, try Lexis Middle East. Click on lexis.ae/demo to begin your free trial of Lexis® Middle East platform.

You can also explore the legal landscape by subscribing to our Weekly Newsletter.

Want to learn more about Lexis® Middle East? Visit https://www.lexis.ae/lexis-middle-east-law/.