Dubai’s VARA Sets Compliance Deadline for Crypto Firms
The Dubai authority has given a deadline to all licensed cryptocurrency firms in a bid to strengthen the risk management process and enhance clarity across Dubai’s growing digital ecosystem. VARA announced that all licensed firms must comply with the newly updated activity-based rulebooks by 19 June 2025.
On May 19, VARA published Version 2.0 of the Rulebooks, which strengthens controls in areas such as margin trading, token distribution services, and more. Also standardized in the updated guidelines are definitions of important terms like “client assets,” “qualified custodians,” and “collateral requirements.” These clarifications will mitigate any confusion on this front and ensure all Virtual Asset Service Providers (VASPs) are on the same page.
The regulator said the updates cover different activities, including advisory and brokerage services, custody, exchanges, lending, and virtual asset management. VARA aims to enhance firms’ compliance when operating in overlapping areas through the alignment of rules related to risk management and disclosures.
One important change is to decrease leverage limits on margin trading that enable investors to borrow capital to increase their market exposure. These restrictions protect traders and the entire market from mass liquidation during volatile times. Margin trading requirements for companies will be more clearly developed, and the changes will enhance monitoring.
A new section on token distribution was also added by VARA. The guidelines explain licensing requirements, investor protection, and marketing limits with a particular focus on offers aimed at retail investors. Through this, the regulations around crypto in Dubai will now be in line with international best practices and will also close gaps identified earlier.
To help firms during the transition, VARA is giving a 30-day window until June 19 for compliance. The supervision team will be in touch with licensed entities and offer bespoke guidance for a smooth adoption of new rules.
To further improve market discipline, crypto service providers must carry out client risk assessments every three months and verify their clients’ information in detail, such as identity, nationality, and employment. The measures aim to increase transparency and protect investors.
Dubai is becoming a trusted global hub for digital assets, according to the city’s regulatory updates. Through compliance and investor protection, VARA is enhancing innovative growth in a secure environment while attracting market participants worldwide.
