Dubai became one of the first jurisdictions in the world to clarify regulatory requirements for Web3 companies, and regulators are now changing its rules related to digital asset marketing. The Virtual Asset Regulatory Authority (VARA) announced that marketing content related to digital assets should come with a disclaimer that people may be financially risky when interacting with digital assets. The current $2.26 trillion global cryptocurrency market is notorious for its turbulent nature, and it is constantly facing the brunt of microeconomic and macroeconomic factors.
According to Vara, all digital assets that release Dubai promotional materials after October 1 must be added to a disclaimer, saying: “Virtual assets may completely or partially lose their value and suffer extreme volatility.”
Authorities in Dubai are seeking to warn people of the risk of financial losses when trading crypto assets. Vara explains the characteristics of virtual assets, highlighting that they can be recorded on public blockchains and can be affected by fraud, manipulation and theft.
In an update guide to all virtual asset service providers (VASPs), Vara clarified that any content containing contradictory messages or “small print” information will not be accepted by regulators. It also states that marketing materials for digital assets must not cause individuals to interact with crypto assets or transmit crypto assets to random wallet addresses.
“The new marketing regulations will apply to all marketing or related marketing in or against virtual assets or VA activities in the UAE.
In March 2022, UAE Prime Minister Sheikh Mohammed bin Rashid Al Maktoum officially introduced Vara to oversee the growth, development and security of the Web3 sector. All Web3 players that want to set up operations in Dubai must use Vara to identify themselves.
However, this is not the only regulator that raises the banner of improper promotion of crypto-related services. The Securities and Exchange Commission of India (SEBI) reportedly raised concerns about celebrities who endorse crypto services and products in 2022. Later that year, the Advertising Standards Commission of India (ASCI) required virtual digital asset (VDA) advertisers to carry a disclaimer, which read: “Crypto products and NFTs are not regulated and may be at high risk. Any losses due to such transaction losses may not have regulatory recourse.”
In May 2023, the UK government said it would ban calls for cryptocurrencies to challenge fraudulent activities.
