All Entities wishing to carry out one or more virtual asset activities in Dubai must seek authorisation from VARA prior to conducting any virtual asset activities.
1- Advisory Service
It means to give a personalized suggestion to a client regarding one or more actions or transactions related to Virtual Assets. This can be done either at the client’s request or initiated by the entity giving the recommendation. When providing the personal recommendation, the entity must take into account the following minimum factors for each client: the client’s knowledge and experience in investing in Virtual Assets, the client’s investment goals such as risk tolerance, investment time frame, and the methods they can use to purchase Virtual Assets, and the client’s financial situation including their ability to handle sudden and substantial losses or the proportion of their net worth invested in Virtual Assets.
| Licence Application Fee: | AED 40,000 |
| Paid-UP Capital Requirement: | AED 100,000. |
2- Broker-Dealer Service
It refers to performing any of the following actions:
- Bringing together buyers and sellers of Virtual Assets to complete transactions.
- Taking orders for Virtual Assets and receiving fiat currency or other Virtual Assets in exchange.
- Helping to match Virtual Asset transactions between buyers and sellers.
- Engaging in Virtual Asset transactions as a dealer, acting on behalf of the entity for its own benefit.
- Creating a market for Virtual Assets using assets belonging to clients.
- Offering services for the placement, distribution, or other aspects of issuing Virtual Assets to clients.
| Licence Application Fee: | AED 100,000 |
| Paid-UP Capital Requirement: | Broker-Dealer Services using a VASP Licensed by VARA to provide Custody Services or otherwise approved during the licensing process: the higher of [i] AED 400,000; or [ii] 15% of fixed annual overheads |
3- Custody Service
It means holding Virtual Assets for someone else in a secure manner and only following confirmed directions from that person. VASPs must abide by the regulations for keeping clients’ Virtual Assets safe. Only VASPs that separate each client’s assets into individual Virtual Asset wallets will be eligible for a license to offer custody services.
| Licence Application Fee: | AED 100,000 |
| Paid-UP Capital Requirement: | The higher of [i] AED 600,000; or [ii] 25% of fixed annual overheads. |
4- Exchange Service
It means engaging in any of the following activities:
[a] exchanging Virtual Assets for fiat currency or vice versa;
[b] exchanging one or more Virtual Assets;
[c] facilitating the trading of Virtual Assets by matching orders between buyers and sellers and conducting exchanges, trades or conversions between Virtual Assets and fiat currency or between different Virtual Assets; or
[d] maintaining a list of buy and sell orders for the purpose of facilitating exchanges, trades, or conversions between Virtual Assets and fiat currency or between different Virtual Assets.
| Licence Application Fee: | AED 100,000 |
| Paid-UP Capital Requirement: | Exchange Services using a VASP Licensed by VARA to provide Custody Services or otherwise approved during the licensing process: the higher of [i] AED 800,000; or [ii] 15% of fixed annual overheads. In all other instances, the higher of [i] AED 1,500,000; or [ii] 25% of fixed annual overheads. |
For extra information about crypto regulation in Dubai, please visit our recent blog.
5- Lending & Borrowing Service
It refers to executing an agreement where a Virtual Asset is loaned from one or more parties (the Lenders) to one or more other parties (the Borrowers) with the promise from the Borrowers to return the Virtual Asset to the Lenders at any time during or at the end of the agreed upon period
| Licence Application Fee: | AED 100,000 |
| Paid-UP Capital Requirement: | The higher of [i] AED 500,000; or [ii] 25% of fixed annual overheads. |
6- Payments and Remittances Services
It refers to the act of receiving Virtual Assets with the purpose of transmitting or transferring them from one entity to another entity or from one VA wallet to another VA wallet, address, or location.
| Licence Application Fee: | AED 40,000 |
| Paid-UP Capital Requirement: | The higher of [i] AED 500,000; or [ii] 25% of fixed annual overheads. |
7- Virtual Asset Management and Investment Services
It means acting as a representative or in a position of trust for an Entity and managing, administering, or making decisions regarding their Virtual Assets. This could involve providing investment management services or overseeing the staking of Virtual Assets for rewards.
| Licence Application Fee: | AED 100,000 |
| Paid-UP Capital Requirement: | VA Management and Investment Services using a VASP Licensed by VARA to provide Custody Services or otherwise approved during the licensing process: the higher of [i] AED 280,000; or [ii] 15% of fixed annual overheads. In all other instances, the higher of [i] AED 500,000; or [ii] 25% of fixed annual overheads. |
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