Dubai Warns of Unauthorized Claims in Real Estate Tokenization Project
2min read Dubai’s Virtual Assets Regulatory Authority (VARA) and the Dubai Land Department (DLD) have jointly issued a formal alert to warn consumers and the market about false claims related to the DLD Real Estate Tokenisation Project. The advisory specifically targets entities falsely stating involvement in a trial initiative launched on March 19, 2025, which is currently restricted to a small, select group of officially approved participants.
According to the announcement, only organizations expressly sanctioned by both VARA and DLD are authorized to participate in the trial. Entities advertising their participation without formal verification from either authority violate regulatory expectations. VARA emphasized that public confirmation of a participant’s status will only be communicated through official DLD or VARA channels. This misrepresentation could have legal implications, as promoting unverified involvement could be interpreted as an attempt to influence consumer behavior or investor decision-making under false pretenses.
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VARA has raised concerns about promoting real estate tokenization services linked to Dubai-based assets. Entities marketing these services to Dubai residents may engage in virtual asset (VA) activities without the required license or official authorization. The authority pointed out that unlicensed operations remain outside the scope of the regulated framework, which includes consumer protection standards and risk mitigation measures. In response, VARA has the authority to impose public alerts, financial sanctions, and trading restrictions under the provisions of Dubai Law No. (4) of 2022 and Cabinet Resolution No. 111/2022.
Consumers engaging with unauthorized platforms claiming ties to the DLD project face significant risks. These platforms operate beyond regulatory oversight, leaving users vulnerable to financial loss without the legal safeguards of the official pilot program. VARA emphasized that such misleading promotions damage trust in the regulatory environment and urged all stakeholders to verify any firm’s licensing or project participation status via the official VARA Public Register before engaging.
VARA clarified that such entities could be engaged in unlicensed virtual asset (VA) activities, which are strictly prohibited unless sanctioned by relevant authorities. The regulator also warned that unlicensed platforms presenting themselves as part of the tokenization project pose a significant threat to consumer protection. Since these firms are not officially involved, they are not subject to the oversight and safeguards built into the project’s pilot framework. VARA urged the public to thoroughly verify the licensing status of any firm offering virtual asset-related services in Dubai and to treat any unverified promotional material or service offering with skepticism. The agency also encouraged the public to report any suspicious activity.
The DLD reaffirmed its commitment to the tokenization project, which aims to digitize property title deeds and convert them into real-world asset (RWA) tokens using blockchain technology. This initiative positions Dubai as a regional leader in real estate innovation. The project’s success would not only enhance the efficiency and transparency of real estate transactions but also attract more investors to the region.
The warning from VARA highlights the importance of regulatory oversight in the rapidly evolving field of virtual assets. As more entities seek to capitalize on the potential of blockchain technology, it is crucial for regulators to ensure that only authorized and compliant firms participate in such initiatives. This not only protects consumers from fraudulent activities but also maintains the integrity of the market. The DLD’s commitment to the tokenization project underscores Dubai’s ambition to become a global hub for innovative financial technologies. By leveraging blockchain technology, the region aims to streamline real estate transactions and create new opportunities for investment. However, the success of this initiative depends on the effective implementation of regulatory measures to prevent unauthorized participation and ensure consumer protection.
