Dubai VARA License: Complete Requirements, Costs, and Timeline (2026)

A VARA licence is required to carry out virtual-asset activities in or from Dubai outside DIFC. Each activity — advisory, broker-dealer, custody, exchange, lending and borrowing, management and investment, transfer and settlement, and Category 1 VA issuance — is licensed separately, with its own paid-up capital, application fee and annual supervision fee. VARA regulates virtual assets, not securities: a token that is a security is analysed under securities law instead.

This guide sets out the requirements as of 14 October 2026, sourced to VARA's Version 2.0 rulebooks (issued 19 May 2025) and the Virtual Assets and Related Activities Regulations 2023.

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What VARA Regulates

VARA was established under Dubai Law No. 4 of 2022. It oversees virtual-asset activities across Dubai, including its free zones, with one critical exception: DIFC falls under the DFSA, not VARA.

VARA licences cover 8 activity categories (VARA FAQ):

1. Advisory Services
2. Broker-Dealer Services
3. Custody Services
4. Exchange Services
5. Lending and Borrowing Services
6. VA Management and Investment Services
7. VA Transfer and Settlement Services
8. VA Issuance (Category 1)

VARA treats each activity as discrete, so each must be applied for explicitly.

What VARA does not cover. VARA is a virtual-asset regulator. If a token is a security — a share, a debt instrument or a fund unit — it is analysed under securities law: the federal Capital Market Authority onshore (the former Securities and Commodities Authority, reconstituted from 1 January 2026), or the DFSA in DIFC. Settle the classification before choosing a VARA route.

VA Issuance under Rulebook Version 2.0

The Virtual Asset Issuance Rulebook (19 May 2025) sorts issuance into three groups:

An ARVA is a virtual asset that represents, or claims to represent, ownership of or entitlement to real-world assets or their income. That makes Category 1 the relevant route for real-world-asset tokens that are virtual assets rather than securities.

For tokenization companies, the relevant activities are typically Advisory, Category 1 VA Issuance and Broker-Dealer for distribution, with custody either licensed in-house or provided by a VARA-licensed custodian.

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Capital Requirements by Activity

Paid-up capital is set in Rule VI.B.1 of the Company Rulebook (Version 2.0, 19 May 2025). Where a VASP holds several licences, it must hold the capital for each activity, calculated on that activity's own fixed annual overheads (Rule VI.B.2).

Net Liquid Assets: at all times, net liquid assets must be at least 1.2 times monthly operating expenses (Company Rulebook, Rule VI.C.1). Only cash, cash equivalents and VARA-approved USD- or AED-referenced virtual assets qualify.

Reserve Assets: VASPs must hold reserve assets equal to 100% of the liabilities owed to clients, in the same virtual asset, reconciled daily and audited by an independent third party at least every six months (Rule VI.E).

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Application and Supervision Fees

Fees are set in Schedule 2 of the Virtual Assets and Related Activities Regulations 2023, checked on 14 October 2026:

Fees apply per licensed activity: a company with Advisory and Category 1 Issuance licences pays both sets. VARA may also impose fees for issuance approval applications and whitepaper submissions, and may adjust fees by risk profile. VARA's fees are separate from those of the commercial licensing authority (Dubai Economy and Tourism or the relevant free zone).

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The Two-Stage Licensing Process

VARA describes two stages for new applicants:

Stage 1: Initial Disclosure Questionnaire and Approval to Incorporate

• Submit an Initial Disclosure Questionnaire through Dubai Economy and Tourism or the relevant free zone, with a business plan and details of beneficial owners and senior management
• Pay an initial fee, typically 50% of the licence application fee
• If successful, receive an Approval to Incorporate (ATI), which allows you to form the legal entity and start operational setup

Stage 2: VASP Licence

• Prepare the full submission under VARA's guidance; VARA may hold meetings and interviews and request more documents
• Pay the remaining fees and the first year's supervision fee
• VARA may issue the VASP licence, with or without operating conditions, or refuse it

VARA may also grant an In-Principle Approval as a conditional step. A firm holding one may not start operations or serve clients until it has the full licence.

How long does it take? VARA does not publish a standard processing time, and we do not quote one. The duration depends on the completeness of the submission, the activities applied for and the number of review rounds. The VARA licence is annual and renewed each year.

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Personnel Requirements

VARA requires each VASP to appoint two Responsible Individuals. Each must be a full-time employee, a fit and proper person approved by VARA, and either UAE-resident or a UAE passport holder (VARA FAQ). Responsible Individuals are accountable to VARA for the VASP's compliance.

VASPs also need compliance and anti-money-laundering functions, including a compliance officer and an MLRO, under VARA's Compliance and Risk Management Rulebook. Key appointments are subject to VARA's fit-and-proper assessment.

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The October 2024 Marketing Regulations

VARA's Regulations on the Marketing of Virtual Assets and Related Activities took effect on 1 October 2024, replacing the 2022 marketing orders.

Entities outside the UAE that do not conduct VA activities in Dubai and do not market to the UAE are generally outside scope.

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Total Cost: What Can and Cannot Be Sourced

The regulator-set costs are in the tables above. For example, an Advisory-only firm faces an AED 40,000 application fee, an AED 80,000 annual supervision fee and AED 100,000 of paid-up capital, plus net liquid assets of 1.2 times monthly operating expenses.

Everything else — legal and consulting work, compliance staff, technology, audit, insurance and premises — depends on the business model and is not set by VARA. We do not publish estimates for those items.

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VARA vs ADGM: Which License for Tokenization?

Both VARA and ADGM are relevant to tokenization companies, but they regulate different things:

Critically, ADGM and VARA are separate jurisdictions. An ADGM permission does not authorise activity in Dubai, and a VARA licence does not authorise activity in ADGM or DIFC. For the financial free zones, see our ADGM vs DIFC comparison; for the wider region, the MENA tokenization regulations guide.

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Compliance Infrastructure Requirements

Beyond licensing, VARA expects substantial compliance infrastructure:

• AML/CFT framework: risk-based customer due diligence, transaction monitoring, suspicious activity reporting
• Sanctions screening: against UN and UAE lists
• Technology governance: cybersecurity, data protection and business continuity under the Technology and Information Rulebook
• Client classification: retail versus qualified or institutional investors
• Client assets: 100% reserve assets against client liabilities, reconciled daily

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Key Decision Points

Our legal setup coordination works through these decisions with qualified UAE counsel, and the legal perimeter memo is a starting template for the classification question.

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Sources

• VARA Virtual Asset Issuance Rulebook, Category 1 VA Issuance (opens in a new tab) (Version 2.0, 19 May 2025), including Annex 1 (FRVA) and Annex 2 (ARVA) capital rules
• VARA Company Rulebook, Part VI — Capital and Prudential Requirements (opens in a new tab) (Rules VI.B, VI.C, VI.E)
• VARA Schedule 2 — Supervision and Authorisation Fees (opens in a new tab)
• VARA Licence Applications (opens in a new tab) and VARA FAQ (opens in a new tab)
• VARA Marketing Regulations 2024 (opens in a new tab)
• Federal Decree-Law No. 32 of 2025 on the Capital Market Authority (opens in a new tab)
• UAE Ministry of Finance: Federal Decree-Law No. 47 of 2022 on the Taxation of Corporations and Businesses

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This article is for informational purposes only and does not constitute legal advice. VARA regulations change; consult qualified UAE-licensed legal counsel before pursuing licensing. Asset Haus provides tokenization infrastructure and structuring support and coordinates legal setup with qualified counsel; it does not guarantee licensing outcomes.

Related: Dubai real estate tokenization market guide · GCC tokenization market report · Client case studies