UAE regulator warns against false representation of government tokenization project

The Dubai Virtual Assets Regulatory Authority (VARA), in coordination with the Dubai Land Department (DLD), has issued an alert regarding entities who have falsely claimed involvement or participation in the pilot phase of the DLD Real estate tokenization project.

In April 2025, the UAE governmental entity, the Dubai Land Department (DLD) partnered with the Dubai Virtual Assets Regulatory Authority (VARA) to link the real estate registry to property tokenization through an advanced governance system.

DLD Tokenization project to enable fractional ownership of real estate assets

The DLD tokenization announcement noted that the collaboration aimed to enable the fractional ownership of real estate assets, allowing a broader base of investors, particularly small investors, to enter Dubai’s real estate market.

This agreement followed the launch of the pilot phase of the “Real Estate Tokenization Project launched by the Dubai Land Department (DLD) for the ‘Real Estate Tokenization Project for property title deeds.

At the time, the announcement noted that the project was being implemented in collaboration with the Dubai Virtual Assets Regulatory Authority (VARA) and Dubai Future Foundation (DFF) through Sandbox Real Estate.

VARA and DLD issue alert that only select participants are involved

VARA and DLD have since then issued the current alert in relation to entities falsely claiming or otherwise purporting to participate in the pilot phase of the “DLD Real Estate Tokenization Project” (“the Project”). The Project was officially launched on 19 March 2025 as a limited pilot phase involving select participants approved by both DLD and VARA.

VARA and DLD alert add that no entities beyond those explicitly approved by DLD and VARA are authorized to participate in the pilot phase.

The alert explains, “Any entity promoting their involvement in the Project without formal confirmation from either VARA or DLD is misrepresenting their status. Official communications confirming participation will be issued solely by DLD and/or VARA.”

Entities marketing real estate tokenization projects in Dubai need to be licensed

The VARA DLD alert adds that entities marketing tokenization services in Dubai may be promoting unlicensed virtual asset activities unless licensed or authorized by the relevant authorities.

The alert adds that such behavior may breach VARA’s regulations and cause financial risks to those engaging with these platforms.

As such, entities engaging in or promoting unauthorized activities or misrepresenting their regulatory status are liable for enforcement action, including but not limited to public alerts, financial penalties, and market prohibitions.