The United Arab Emirates (UAE) has passed a new law governing virtual assets, establishing an initial regulatory regime for cryptocurrencies at the federal level, Cointelegragh reported. The new law ensures that entities engaging in crypto activities must be licensed and approved by the new regulator. Failure to comply could lead to hefty fines of up to 10 million dirhams ($2.7 million), confiscation of profits and even a criminal investigation by prosecutors. The law is expected to take effect on January 14. The UAE has previously launched several digital asset regulatory initiatives in economic free zones such as the Abu Dhabi Global Market (ADGM). Dubai also established its own crypto regulator, the Virtual Assets Regulatory Authority (VARA), last year.