Promoters of fraudulent cryptocurrency schemes will face up to five years in prison and fines of more than £ 200k in the United Arab Emirates (UAE).
The new measures will take effect on January 2 of next year as part of the country's new online security laws.
They are part of sweeping legal reforms introduced by the country's president, Sheikh Khalifa, in November.
The UAE says the laws are meant to protect Internet users from wire fraud and preserve privacy and personal rights. The National reported.
Currently, there is no rule against crypto assets in the UAE, but it is regulated by the Securities and Commodities Authority (SCA) of the country.
The UAE previously banned the promotion of cryptocurrencies, but lacked provisions that would allow authorities to sanction such violators.
`` Posting misleading ads or inaccurate data online about a certain product will be punishable by jail time and / or a fine of between £ 4,058 and £ 101,442, '' Al Rowaad Advocates' legal expert Dr. Hassan Elhais told the website. .
The UAE is also taking action against those who spread fake news using 'bots' to spread misinformation.
Article 54 establishes that the use or modification of electronic robots to share, re-share or circulate false news in the country may be subject to a prison sentence of two years or a fine of not less than £ 2026 and up to £ 200k, or both, Dr. Elhais said.
Several UAE authorities have previously raised concerns about fraud related to crypto-asset transactions, as fake cryptocurrency schemes become a growing problem. The country's law enforcement agencies have also warned residents to beware of fake cryptocurrency schemes that promise instant wealth.
Tighter regulations follow an increase in the number of fraudulent cryptocurrency schemes. In May 2021, the government was forced to publish a statement disassociate from 'Dubai Coin'.
"The website promoting the coin is an elaborate phishing campaign that is designed to steal personal information from its visitors," the tweet read.
Cryptocurrency scams reportedly cost investors over £ 5.7bn this year alone hitting a record 81%.
The latest figures showed people only in Dubai lost about 80 million DH (£ 16 million) to crypto scams in the first half of 2021 alone.
This led the police to issue warnings to residents about for-profit and fake trading schemes related to cryptocurrencies.
In July, nine men were jailed for 10 years after cheating victims out of £ 3 million through a get-rich-quick cryptocurrency trading scam.
Earlier this month, the Dubai World Trade Center was declared to be both a comprehensive crypto zone and a regulator, allowing you to design an extensive hub for industry progression.
PLUS : Major Cryptocurrency Flaw Makes Traders Think They Are Billionaires
PLUS : Cryptocurrency Omicron Rises 900% With Rise Of New Covid Variant
Get the latest news you need to know, feel-good stories, analysis, and more
