VARA Broker-Dealer License: What You Need to Know

Cryptocurrency in the Emirate of Dubai and across the UAE is evolving at speed, and that pace is exactly what is turning the country into a serious global hub for digital assets.Instead of letting the market grow in a legal grey zone, Dubai has built a dedicated regulator, the Virtual Assets Regulatory Authority (“VARA”), which serves as the dedicated regulator overseeing Virtual Asset Service Providers (“VASPs”) across Dubai. Its mandate is to create a secure, transparent, and sustainable environment for virtual asset activities, ensuring that innovation is balanced with investor protection and financial stability.

Broker-Dealer Services Explained

VARA doesn’t just talk about “crypto”; it uses the broader term Virtual Assets, a digital representation of value that can be traded or transferred electronically or used as a means of exchange, payment, or investment purposes. This includes virtual tokens, and any digital representation of any other value as determined by VARA.VARA has carved the market into eight regulated virtual asset activities, one of the most commercially important being Broker-Dealer Services. A VARA-licensed broker-dealer sits at the heart of trading and liquidity. Under the Broker-Dealer Rulebook, this type of VASP can, among other things:

Arrange the purchase or sale of virtual assets between clients
Solicit or accept orders for virtual assets and currencies
Facilitate the matching of transactions between buyers and sellers
Enter into virtual asset transactions as a dealer on behalf of an entity
Act as a market maker, including using client assets where the rules allow
Provide placement, distribution, or other issuance-related services to clients issuing virtual assets

In simple terms: the Broker-Dealer is the regulated middleman that makes markets, routes orders, and connects issuers and investors in Dubai’s virtual asset ecosystem.

What Are VARA’s Key Requirements for Broker-Dealer VASPs?

Beyond understanding how a Broker-Dealer operates, VARA requires every applicant to demonstrate strong governance, responsible order-handling, and full protection of client assets. A Broker-Dealer must show that it can assess client suitability, manage conflicts of interest, and execute trades in the client’s best interests.This means documenting how client instructions are taken, how prices are sourced, how liquidity is accessed, and how the VASP ensures “best execution” at all times.A Broker-Dealer must also be transparent: Clients must receive clear information on risks, fees, order-handling practices, custody arrangements, and any incentives the firm receives. Monthly statements, accurate valuations, and complete transaction records must be maintained for at least eight years.Importantly, a Broker-Dealer may only use client assets when explicitly permitted, and it must have strong internal systems to prevent misuse, conflicts, or unauthorised dealing.Marketing must be factual and verifiable, with no exaggerated claims, future projections, or misleading impressions about liquidity or returns.These operational expectations sit at the core of the Broker-Dealer licence and distinguish regulated broker-dealers from informal market intermediaries, aspects that we at Rasma Legal are well-positioned to assist with.

What Changed Under VARA’s Updated Broker-Dealer Framework?

On 19 May 2025, VARA published Version 2.0 of its activity-based Rulebooks, including updated rules for Broker-Dealer Services and Virtual Asset Issuance. These updates tightened supervision across all VA activities and introduced more detailed requirements around things like margin trading and token distribution services.Under this refreshed framework, a licensed Broker-Dealer is not just a trading venue or execution desk. Where it meets the conditions for licensed distribution services, it can effectively step into the role of licensed distributor for new tokens or other virtual assets issued into the Dubai market.Practically, that means:

An issuer of a token, cryptocurrency, or other virtual asset can partner with a licensed broker-dealer
The broker-dealer, acting as a licensed distributor, can provide issuance-related and distribution services, helping bring that asset to market in Dubai
To do that, the broker-dealer must file the required documentation and disclosures with VARA (for example under the VA Issuance Rulebook and related guidance) and show that the structure, marketing, and distribution all comply with VARA’s rules

Why this matters for issuers, investors, and Dubai’s market

For issuers, the message is clear: you no longer need to navigate token launches through informal or unregulated channels. You can plug directly into a regulated distribution network by working with broker-dealer VASPs who understand VARA’s documentation, disclosure, and marketing expectations.For broker-dealers, the Broker-Dealer licence now goes beyond execution and market-making. It opens up a new line of business in primary distribution and issuance support, from structured token sales and private placements to more retail-facing offerings, depending on what VARA allows in each case.And for Dubai as a jurisdiction, this is a big step toward a more complete virtual asset framework: trading, custody, issuance, and distribution are now clearly mapped to specific licences, rulebooks, and obligations. That clarity makes it easier for serious players, exchanges, institutional investors, and global projects to treat Dubai not just as a “crypto-friendly” city, but as a fully regulated launchpad for virtual assets.

What are the necessary costs and capital requirements?

Any entity that wants to apply for a Broker-Dealer license under VARA has to meet specific paid-up capital requirements, designed to make sure that the entity can withstand operational and market shocks.If a Broker-Dealer uses a VASP licensed by VARA to provide Custody Services, it must hold the higher of:

AED 400,000
15% of its fixed annual overheads

In all other cases, whereby custody is handled differently, the bar is higher, and the Broker-Dealer must hold the higher of:

AED 600,000
25% of its fixed annual overheads

To complete the picture, VARA doesn’t just set how much paid-up capital a Broker-Dealer must have, it also dictates how and where that capital must be held.VARA requires all VASPs to maintain their paid-up capital in secure, regulator-approved forms. At all times, the capital must be held in one of the following ways:

UAE bank trust account
Surety bond
Another arrangement approved by the regulator

How Rasma Legal Can Support You

Rasma Legal helps businesses navigate every stage of the VARA licensing and compliance journey. Our team has successfully worked with VARA across multiple licensing categories and understands the practical and regulatory requirements for operating in Dubai’s fast-evolving digital or crypto asset market. Whether you are applying for a VARA license or strengthening your ongoing compliance, we provide the strategic guidance and hands-on support you need to build a secure, compliant, and scalable VA business.