Institution

SCA-VARA Unified VA Sector Register — UAE Regulatory Coordination Brief

Analysis of the July 2023 SCA-VARA agreement to establish a unified register of regulated VASPs across the UAE.

Summary

SCA-VARA Unified VA Sector Register — UAE Regulatory Coordination Brief represents a significant development in Dubai’s virtual asset regulatory landscape. This brief examines the regulatory implications for VARA-licensed VASPs and the broader virtual asset ecosystem operating under the Virtual Assets and Related Activities Regulations 2023.

Regulatory Context

The Virtual Assets Regulatory Authority (VARA) — the world’s first independent regulator for virtual assets — oversees all virtual asset activities in the Emirate of Dubai, excluding the Dubai International Financial Centre (DIFC). Since its establishment, VARA has published 41 circulars, announcements, and regulatory notices, each adding to the compliance framework that licensed VASPs must navigate.

This regulatory development emerged within a period of intensive regulatory activity. Throughout 2023-2026, VARA has progressively strengthened its framework through the initial Regulations 2023, the Version 2.0 rulebooks (May 2025), and continuous circular publication addressing AML/CFT requirements, FATF high-risk jurisdiction measures, Travel Rule implementation, and operational standards.

Detailed Analysis

The regulatory measure under examination reflects VARA’s systematic approach to building a comprehensive virtual asset regulatory framework. Each circular and announcement adds specificity to the foundational Regulations, creating an increasingly detailed obligation set for licensed entities.

Impact on Licensed Entities

Licensed VASPs — including Binance Dubai, OKX Middle East, BitOasis, Crypto.com Dubai, and other approved entities — must assess the new requirements against their existing compliance programmes and implement any necessary changes.

The compliance assessment process involves reviewing current policies and procedures against the regulatory requirements, identifying gaps, developing remediation plans, implementing changes, training staff, and documenting the compliance update for regulatory review.

Operational Considerations

From an operational perspective, this development requires attention to several areas:

Policy and Procedure Updates: Compliance documentation must be reviewed and updated to incorporate the new requirements. This includes updating compliance manuals, operational procedures, and training materials.

Technology Systems: Where the regulatory development affects monitoring, screening, or reporting systems, technology updates must be planned, implemented, and tested to ensure compliance.

Governance Reporting: Material regulatory developments should be reported to governance bodies, including the board of directors or relevant committees, ensuring senior management awareness and oversight.

Staff Training: All relevant staff must be trained on the new requirements, with training records maintained as evidence of compliance readiness.

Supervisory Expectations

VARA’s supervisory function will incorporate the new requirements into its ongoing oversight of licensed entities. The authority’s enforcement record — covering 36+ entities — demonstrates that compliance expectations carry real consequences. The MORPHEUS/FUZE case in August 2025 specifically cited compliance programme failures, establishing that VARA assesses the quality of compliance implementation, not merely the existence of compliance policies.

International Context

This development aligns with broader international trends in virtual asset regulation. Comparable frameworks are being developed and refined by regulators in Abu Dhabi (ADGM FSRA), Singapore (MAS), Hong Kong (SFC/HKMA), and the European Union (MiCA). The convergence of regulatory standards across major jurisdictions reflects the influence of FATF recommendations and G20 policy coordination on national regulatory approaches.

For VASPs operating across multiple jurisdictions, understanding the relationship between VARA’s requirements and comparable requirements in other jurisdictions supports efficient multi-jurisdictional compliance. See our comparisons section for detailed analysis.

Enforcement and Compliance Risks

Non-compliance with VARA’s regulatory requirements carries enforcement risk. VARA’s enforcement toolkit includes supervisory warnings, cease-and-desist orders, financial penalties, licensing measures, and the appointment of skilled persons.

The enforcement record through early 2026 demonstrates active and escalating enforcement activity:

5 enforcement actions in 2024
30+ enforcement actions in 2025
Continued enforcement in 2026 (VESTA PRIME PORTAL)

For the complete enforcement timeline, see our enforcement actions dashboard.

Recommendations

Obtain and review the full regulatory instrument from VARA’s official channels
Conduct a compliance gap analysis against current programmes
Develop and implement remediation plans for identified gaps
Update staff training to reflect new requirements
Document compliance updates for regulatory review
Monitor for subsequent circulars or guidance that may further clarify requirements

Background and Significance

In July 2023, the Securities and Commodities Authority (SCA) and VARA announced coordination to ensure a “Unified VA Sector Register of Regulated VASPs for the UAE.” This agreement addresses a fundamental question in UAE virtual asset regulation: how to maintain regulatory clarity at the federal level when virtual asset licensing is administered at the emirate level by different authorities.

The Regulatory Architecture Problem

The UAE’s regulatory architecture for virtual assets involves multiple regulators across different jurisdictions:

VARA: Regulates virtual assets in the Emirate of Dubai (excluding DIFC)
SCA: Federal-level securities and commodities regulator with jurisdiction over certain activities across all emirates
ADGM FSRA: Regulates financial services (including virtual assets) within the Abu Dhabi Global Market free zone
DFSA: Regulates financial services within the Dubai International Financial Centre
CBUAE: Central bank with jurisdiction over payment services, stablecoins, and certain monetary instruments

This multi-regulator landscape creates the risk of regulatory gaps (where no authority claims jurisdiction) or overlaps (where multiple authorities claim jurisdiction). The SCA-VARA unified register addresses this by ensuring that VARA-licensed entities are recognised at the federal level and that SCA can identify which entities are authorised to provide virtual asset services within the UAE.

What the Unified Register Achieves

The unified register serves several functions:

Regulatory Transparency: Provides a single reference point for determining which entities are licensed to conduct virtual asset activities anywhere in the UAE
Consumer Protection: Enables consumers to verify whether a service provider is licensed before engaging, reducing the risk of interacting with unlicensed operators
Federal Coordination: Ensures that SCA’s federal regulatory activities are coordinated with VARA’s emirate-level licensing
Enforcement Support: Facilitates identification of unlicensed operators by providing a comprehensive list of authorised entities

SCA’s Regulatory Context

The July 2023 announcement noted that SCA “had received licensing requests and inquiries from companies intending to provide Virtual Asset services following the issuance of the necessary regulations.” This suggests that some entities were approaching the federal regulator for virtual asset licensing rather than the appropriate emirate-level authority. The unified register helps redirect such inquiries and clarifies the regulatory pathway.

Impact on Licensed VASPs

For licensed entities including Binance Dubai, OKX Middle East, BitOasis, Crypto.com Dubai, Bybit Dubai, and Rain Financial, the unified register provides federal-level recognition of their VARA licensing. This recognition may facilitate relationships with federal authorities, banking partners, and other regulated entities that require verification of licensing status.

The unified register also reinforces the distinction between licensed and unlicensed operators. VARA’s enforcement actions against 36+ entities for unlicensed activities — including Vesta Prime Portal (January 2026) and UAEC Digital Fintech (August 2025) — are supported by the clarity that the unified register provides about which entities are and are not authorised.

Relationship to Other Regulatory Developments

The SCA-VARA coordination is part of a broader pattern of institutional collaboration in UAE virtual asset regulation:

VARA-DET Consumer Protection MOU (August 2023): Coordination on consumer protection standards
CBUAE Coordination: Ongoing collaboration on payment token services and stablecoin regulation
UAE Federal AML Decree-Law: Federal AML requirements that apply to VARA-licensed VASPs
UAE National Risk Assessment: Federal-level risk assessment that informs VARA’s supervisory approach

International Comparison

The challenge of maintaining a unified register across multiple regulatory jurisdictions is relevant internationally:

EU MiCA: The EU’s approach creates a single framework across all member states, with mutual recognition of authorisations
UAE: The multi-regulator model requires explicit coordination mechanisms like the SCA-VARA unified register
United States: The SEC, CFTC, FinCEN, and state regulators each maintain separate registers, creating fragmentation that the UAE’s unified register approach seeks to avoid

The unified register positions the UAE ahead of jurisdictions that have not established coordination mechanisms between multiple virtual asset regulators.

Operational Benefits of the Unified Register

For Licensed VASPs

The unified register provides practical benefits for licensed entities:

Banking Relationships: Banks conducting counterparty due diligence can verify VARA licensing through the federal register, simplifying account opening and maintenance
Institutional Partnerships: Corporate partners and institutional counterparties can confirm regulatory status through a single federal-level resource
Cross-Emirate Recognition: The unified register ensures that VARA licensing is recognised for regulatory purposes across all UAE emirates, not just Dubai
Customer Confidence: Consumers can verify that their chosen virtual asset platform is licensed and federally recognised

For Market Integrity

The unified register supports market integrity by:

Identifying Unlicensed Operators: Entities claiming regulatory approval can be verified against the register, helping consumers and partners identify fraudulent claims
Supporting Enforcement: VARA’s enforcement actions against 36+ unlicensed entities are strengthened by the clarity the register provides about which entities are and are not authorised
Facilitating Coordination: When SCA receives inquiries about virtual asset activities, the unified register enables accurate referral to the appropriate authority (VARA for Dubai, ADGM FSRA for Abu Dhabi, or DFSA for DIFC)

Register Maintenance

The ongoing maintenance of the unified register requires coordination between SCA and VARA as licensing activity continues. New licences, licence amendments, licence revocations, and enforcement actions all require register updates to maintain accuracy.

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