How to Get a VARA License?

Your Guide to Operating in Dubai’s Virtual Asset Landscape

The world of virtual assets is booming, and Dubai is at the forefront of innovation with the Dubai Virtual Assets Regulatory Authority (VARA). If you’re an entrepreneur looking to establish your Virtual Asset Service Provider (VASP) business in Dubai, obtaining a VARA license is crucial.

However, navigating the application process can seem daunting. Worry not! This comprehensive guide will equip you with the knowledge to confidently secure your VARA license and unlock exciting opportunities in Dubai’s thriving virtual asset ecosystem.

Why Choose Dubai for Your VASP Business?

Dubai’s progressive regulatory framework fosters a secure and transparent environment for virtual asset businesses. With a VARA license, you gain access to a dynamic market brimming with potential, while benefiting from:

• Government support: Dubai’s government actively fosters virtual asset-space innovation.
• Tax advantages: Enjoy competitive tax regimes within Dubai’s free zones by starting a company in Dubai Freezone.
• World-class infrastructure: Dubai boasts advanced infrastructure to support your business operations.

Understanding the VARA License

The VARA license authorizes your VASP to conduct specific activities within Dubai’s virtual asset framework. These activities can include:

• Operating a cryptocurrency exchange
• Providing custodial wallet services
• Facilitating initial coin offerings (ICOs)

The Two-Stage VARA License Application Process

The VARA application process involves two key stages:

Stage 1: Initial Approval

1. Initial Disclosure Questionnaire (IDQ): This questionnaire, submitted to Dubai Economy and Tourism (DET) or your chosen free zone authority, gathers information about your VASP, ownership structure, and proposed activities.
2. Supporting Documentation: Prepare to submit documents such as business plans, financial statements, and KYC (Know Your Customer) details for your company’s beneficial owners and key personnel.
3. Initial Fee Payment: Pay the initial application fee, usually half the total license fee.
4. Initial Approval: Upon successful review, you’ll receive approval to proceed with company incorporation and operational setup.

Stage 2: Full License Application

1. Comprehensive Documentation: Prepare a detailed application package per VARA’s guidelines following initial approval. This may include enhanced due diligence reports, AML/CFT policies, and technical infrastructure details.
2. VARA Review and Potential Engagement: VARA will meticulously evaluate your application. This might involve interviews, meetings, and requests for further information.
3. Final Fees and Supervision Fees: Pay the remaining license and the first year’s supervision fees.
4. Issuance of VARA License: Congratulations! Once everything is in order, VARA will grant you the coveted VARA license, potentially subject to specific operational conditions.

Crypto License vs. VARA License

“Crypto License” and “VARA License” are sometimes used interchangeably. However, it’s essential to understand the distinction. While a VARA license is specific to Dubai and regulates a broad range of virtual asset activities, a “Crypto License” could refer to various global permits issued by different authorities, each with its scope and regulations.

Learn more about the crypto license required to register a crypto company in Dubai and the UAE.

Additional Considerations

• Staying Updated: The virtual asset landscape is constantly evolving. Check VARA’s website regularly for updates on regulations and licensing requirements.
• Seeking Professional Guidance: Considering the intricate nature of the application process, consulting with experienced business setup consultants who are well-versed in VARA regulations can be highly beneficial.

Following these steps and staying informed, you can successfully navigate the VARA licensing process and establish your VASP business in Dubai’s dynamic virtual asset market.

With a VARA license in hand, you’ll be well-positioned to capitalize on the immense potential of Dubai’s thriving virtual asset ecosystem.