On Monday, the Virtual Assets Regulatory Authority (Vara) penalized Morpheus Software Technology FZE (Morpheus Fuze) for breaching anti-money laundering (AML) regulations and not adhering to governance standards.
Morpheus received its Virtual Asset Service Provider Licence on October 19, 2023. Vara initiated a regulatory probe on April 15, 2025, and determined that the company had deficiencies in its AML program, governance, compliance, and internal systems.
Additionally, Morpheus knowingly engaged in unlicensed virtual asset activities, breaching its licence, and failed to disclose important information to Vara.
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Due to these violations, Vara has enforced actions, including a financial penalty on Morpheus.
Vara indicated that Morpheus (Fuze) has acknowledged the findings and suggested a plan to address these breaches. Furthermore, a qualified individual will be appointed to supervise the implementation of the corrective plan.
Morpheus (Fuze) will undergo ongoing supervision by Vara, ensuring the completion of remedial measures to secure the marketplace and protect consumers.
The regulator did not disclose the specific amount of the fine imposed on the company.
Vara is responsible for regulating, supervising, and overseeing virtual asset services in Dubai, excluding the Dubai International Financial Centre.
