VARA Fines Morpheus (Fuze) Over Compliance Failures

Dubai's Virtual Assets Regulatory Authority (VARA) has taken enforcement action against Morpheus Software Technology FZE, also known as Morpheus (Fuze), citing significant compliance shortcomings and unlicensed activity.

The regulator said an investigation launched in April 2025 uncovered failures in the firm's anti-money laundering framework, governance structures, and internal controls. According to VARA, Morpheus (Fuze) also engaged in virtual asset activity outside the terms of its licence and withheld key information from the authority.

As a result, VARA imposed a financial penalty and required the appointment of an independent "Skilled Person" to oversee remediation efforts. The firm has accepted the findings and submitted a plan to address the breaches.

Going forward, VARA confirmed Morpheus (Fuze) will remain under heightened supervision to ensure corrective measures are completed. The authority emphasized that such actions are part of its mandate to secure Dubai's virtual asset market and safeguard investors.