Crypto scams, rug pulls and other such cybercriminal activities have continued to act as a major bane for the cryptocurrency industry that is still striving for mainstream acceptance. In just the previous year, such scams cost investors over $7.7 billion after noting a record spike of 81%.
Although many governments routinely circulate warnings regarding the same, the UAE government has decided to take this one step forward by imposing harsh punishment on such perpetrators. According to local media, cyber-criminals found to be promoting cryptocurrency scams online will face up to 5 years in prison along with a fine of up to 1 million DH ($272,259) as the country’s government has toughened up its laws to protect citizens against cyber fraud.
Fraud can cost you dearly
These laws are part of legal reforms being undertaken by the administration, which brought the advertisement of rogue cryptocurrencies that are not recognized by the authorities under the ambit of cybercrime.
While previous laws had imposed a ban on the promotion of such cryptocurrencies, the reforms have penalized the activity for the first time in hopes of putting an end to this exploitation.
Even with robust regulation and a crypto-friendly environment, citizens of the UAE have continued to fall prey to these financial frauds. In fact, people in Dubai alone lost around 80 million DH in hundreds of such scams in just the first half of 2021. This prompted the UAE police to issue warnings to residents about fake trading and profit-making schemes related to cryptocurrencies.
Regardless of this, one of the most elaborate phishing scams experienced by the city was the DubaiCoin. The digital asset was promoted as one with official backing and investors leaped to the opportunity, leading its valuation to grow many folds in a short period of time.
Dubai Coin cryptocurrency was never approved by any official authority.
The website promoting the coin is an elaborate phishing campaign that is designed to steal personal information from its visitors. pic.twitter.com/Q0HBXfqaDO
— Dubai Media Office (@DXBMediaOffice) May 27, 2021
Other scammers have not been lucky enough to get away, as 9 men from the country were sent behind bars for 10 years, earlier in July after duping victims out of 18 million DH through a get-rich-quick cryptocurrency trading scam.
The Dubai Police force has even partnered with the regulated firm BitOasis to spread fraud awareness among citizens while also building regulations that will make crypto safe for investors in the region.
The city has not failed to deliver when it comes to building a robust and inclusive crypto framework. Earlier this month, the Dubai World Trade Center was declared to be both a comprehensive crypto zone and regulator, which will allow it to design an extensive hub for the progression of the sector.