Dubai's Virtual Assets Regulatory Authority (VARA) has established the most comprehensive crypto regulatory framework in the Middle East. For exchanges seeking to operate in the region, a VARA license is rapidly becoming the gold standard.
Understanding VARA
VARA was established as an independent regulator specifically for virtual assets in Dubai. It operates outside the DIFC, covering the broader Dubai mainland. This distinction matters for licensing strategy as VARA and the DFSA have separate jurisdictions.
License Categories
VARA offers multiple license categories including exchange services, broker-dealer services, custody services, and advisory services. Most international exchanges will apply for the exchange services category, which permits the operation of a trading platform.
Application Requirements
Applicants must demonstrate robust technology infrastructure, comprehensive AML and KYC procedures, adequate capital reserves, and qualified management. VARA conducts thorough assessments including cybersecurity audits.
Compliance Framework
VARA's rulebook covers market conduct, technology governance, consumer protection, and data management. Compliance costs are significant but reflect the seriousness that Dubai brings to regulated crypto markets.
Timeline and Costs
A VARA license application typically takes four to eight months. Between application fees, compliance infrastructure, and operational setup, exchanges should budget accordingly for their Dubai entry.