VARA Warns on Memecoins as Capitalization Hits $120B: MOEI Partners with Shiba Inu

Dubai’s Virtual Assets Regulatory Authority (VARA) recently
issued a consumer alert addressing the risks associated with advertisements
promoting subscriptions to memecoins.

This alert follows the recent partnership between the UAE
Ministry of Energy (MOEI) and Shiba Inu to explore Web3 solutions in energy,
infrastructure, and governance.

VARA Warns on Memecoin Risks

The market capitalization of meme coins has surged from $20
billion in January 2024 to $120 billion by the end of the year, prompting a
warning from VARA about the associated risks.

VARA noted that many meme coins do not have intrinsic value.
Instead, their pricing is often driven by “social media trends, public
hype, or deceptive promotional tactics”.

Dubai’s #VARA warns against meme coin hype 🚨Dubai’s Virtual Assets Regulatory Authority has issued a public alert on meme coin promotions, citing high risks for investors. 👉Learn more: https://t.co/kgq0Z4IR5z pic.twitter.com/uUlRkRABvl

— crypto.news (@crypto_dot_news) February 14, 2025

The regulator cautioned investors to be wary of claims
promising unrealistic returns, as these are frequently indicative of fraudulent
schemes. VARA also pointed out the high risk of substantial financial losses
within short timeframes, due to factors such as sudden price collapses,
liquidity issues, or scams.

“Both consumers and investors should be aware that
access to memecoin platforms may be restricted without prior notice. Thus,
everyone must take necessary measures to safeguard personal financial security,”
VARA warned.

SHIBUSD Trades Within Equidistant Channel

Meanwhile, the SHIBUSD H1 chart shows the price has been
trading within an equidistant channel. Recently, the price bounced at the
channel’s support, but no bullish momentum has formed yet. Buyers may wait for
a breakout above the last swing high at 0.00001680 to enter long.

Alternatively, if the price bounces off the channel’s support again and forms a
bullish reversal pattern, it could trigger bullish momentum. On the other hand,
a bearish breakout at the support could push the coin lower.

MOEI Partners with Shiba Inu for Web3

In its alert, VARA made it clear that any virtual asset
issued from Dubai, including related promotions, advertisements, or
solicitations, must adhere to the regulatory framework set by the authority. It
also warned entities involved in unauthorized virtual asset activities that
they may face enforcement actions.

This announcement by VARA follows the recent news that the
UAE Ministry of Energy (MOEI) entered a partnership with Shiba Inu to develop
Web3 solutions in sectors including energy, infrastructure, and governance. The
collaboration aims to utilize Shiba Inu’s range of Web3 technologies to enhance
public service efficiency, support green infrastructure, and develop
citizen-focused governance models.

This article was written by Tareq Sikder at www.financemagnates.com.