Dubai’s digital asset regulator has instructed entities behind crypto exchange KuCoin to halt unlicensed virtual asset activities in the emirate, warning investors that the platform is not authorized to serve Dubai residents.
In a Thursday investor and marketplace alert, the Virtual Assets Regulatory Authority (VARA) said that Phoenixfin Pte Ltd, MEK Global Limited, Peken Global Limited and Kucoin Exchange EU GmbH, all commercially advertising as KuCoin, may be providing virtual asset activities to Dubai residents, “without the necessary regulatory approvals and misrepresenting its licensing status.”
VARA said the group had been instructed to cease and desist all unlicensed digital asset activities and stressed that KuCoin did “not hold any licence to provide Virtual Asset services in/from Dubai.”
The watchdog added that any virtual asset activities advertised or conducted by the entities were in breach of VARA regulations and wider United Arab Emirates legislation, including Dubai Law No. 4 of 2022 and Cabinet Resolution No. 111/2022, which require all virtual asset service providers to be licensed to operate legally.
VARA also clarified that “any promotion, advertising, or solicitation related to KuCoin has not been approved,” and that the exchange was not permitted to offer, promote or market virtual asset products or services in Dubai or to its residents.
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Consumers engaging with unlicensed platforms face “significant financial risks and potential legal consequences” for violating regulatory requirements or even criminal laws, the regulator warned.
VARA urged Dubai-based users to avoid using KuCoin for virtual asset services, to verify that companies are on its public register of licensed providers before transacting and to report any suspected unlicensed activity directly to the authority.
Dubai alert follows Austria freeze on KuCoin EU
The Dubai alert comes shortly after Austria’s Financial Market Authority froze new business at KuCoin EU, the Vienna-based entity that holds a Markets in Crypto-Assets Regulation license, citing failures to maintain key Anti-Money Laundering, Counter-Terrorist Financing and sanctions compliance roles.
KuCoin’s European management said that it had voluntarily paused new onboarding and some trading activities while it worked to refill those positions and bring the business back into full compliance.
Cointelegraph reached out to KuCoin for comment but had not received a response by publication.
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