UAE Cabinet Resolution No. 111 of 2022 Virtual Assets Regulation

The resolution defines virtual assets as digital representations of property value that can be digitally traded, transferred or used for investment purposes, excluding digital representations of paper currencies, securities and other funds. It defines VASPs as legal persons conducting one or more virtual-asset activities for or on behalf of another person, including platform operators, brokers and custodians.

The federal perimeter applies to the UAE virtual-asset sector, virtual-asset activities and VASPs, including free zones. It excludes regulation of virtual assets inside financial free zones, digital securities and digital commodity contracts governed by SCA-specific rules, and payment-purpose virtual assets or stored-value facilities under the Central Bank of the UAE, except where the Central Bank approves them for listing and trading for investment purposes on a virtual-asset platform.

Article 4 establishes the approval and licensing baseline: a person may not engage in virtual-asset activities in the UAE without approval and a licence from the SCA or a local licensing authority, as applicable. It also requires a person wishing to conduct virtual-asset activities to have the UAE as its domicile for those activities and to use a legal form approved by the local commercial-licensing authorities.

Article 5 identifies core licensable activities: operating and managing virtual-asset platforms; exchange services between one or more forms of virtual assets; transfer services; brokerage services for trading virtual assets; and custody and management services enabling control over virtual assets. The Cabinet may amend the activity list based on an SCA proposal coordinated with local licensing authorities and the Central Bank.

The resolution gives the SCA, now read with the Capital Market Authority transition, federal oversight of virtual-asset activities, VASPs and virtual-asset transactions in the UAE including free zones. It authorizes implementing resolutions, licensing mechanisms, data-protection verification, AML/CFT monitoring, investor-risk awareness, and Central Bank coordination for financial and monetary stability.

Minimum licensing checks include sanctions-list screening, absence of relevant criminal investigations or convictions, technology and cybersecurity capacity, investor-data protection, capital, credit guarantee, insurance and compliance-management conditions. Ongoing supervision covers clear and non-misleading risk disclosure, compliance with UAE AML/CFT legislation and FATF requirements, and mechanisms for VASPs to notify the regulator and relevant entities of security risks, breaches or cybercrime-related conduct.

Local licensing authorities must provide VASP, licensing and transaction information to the federal regulator on request, while the federal regulator coordinates with local authorities, the Central Bank and other entities. Cabinet Decision No. 112/2022 separately delegated specified Resolution 111/2022 functions to Dubai’s Virtual Assets Regulatory Authority for Dubai and its free zones; VARA’s rulebook states that VARA regulates Dubai mainland and free zones except the DIFC.

Article 12 contemplates warnings, suspension of listings or platforms, suspension or revocation of licences, closure assistance, fines up to AED 10 million, profit-or-loss-based fines, and referral to public prosecution. Cabinet Resolution No. 99 of 2024 later issued a detailed violations and administrative penalties table for Resolution 111/2022. Cabinet Resolution No. 83 of 2025 set fees for VASP registration, licensing, renewals and cancellations. Editors should monitor implementing resolutions and any Capital Market Authority updates because the 2025 decree preserves the 2022 virtual-asset resolutions only to the extent they remain consistent with newer legislation.