How to Get a Crypto License in the UAE: A 2025 Legal Perspective

As the UAE positions itself as a global leader in the digital economy, its regulatory environment for virtual assets has become one of the most progressive and clearly defined in the world. For entrepreneurs, startups, and investors seeking to establish a cryptocurrency business in the UAE, obtaining a proper license is not merely a procedural formality—it is a regulatory imperative. 

This article outlines the current legal framework for obtaining a crypto license in the UAE in 2025, focusing on applicable laws, licensing categories, eligibility criteria, compliance obligations, and penalties for non-compliance. 

A. Regulatory Overview: VARA and SCA 

1. Virtual Assets Regulatory Authority (VARA) 

Established under Law No. (4) of 2022 Regulating Virtual Assets in the Emirate of Dubai, VARA is the designated authority for overseeing virtual asset activities in Dubai (excluding DIFC). It is empowered to license and supervise all entities conducting virtual asset activities such as advisory, exchange, custody, and brokerage services¹. 

VARA governs through its Virtual Assets and Related Activities Regulations 2023, which are supplemented by subject-specific rulebooks covering everything from AML compliance to cybersecurity². 

2. Securities and Commodities Authority (SCA) 

For businesses operating in the UAE mainland or free zones outside VARA's remit, the Securities and Commodities Authority (SCA) is the responsible regulator. This is according to Cabinet Decision No. (111) of 2022 Concerning the Regulation of Virtual Assets and Service Providers, which governs the licensing, registration, and regulation of crypto businesses in those jurisdictions³. 

B. Types of VARA Licences Available 

VARA licenses activities under the following categories, each governed by its respective rulebook⁴: 

1. Advisory Services (Advisory Services Rulebook) 

2. Broker-Dealer Services (Broker-Dealer Services Rulebook) 

3. Custody Services (Custody Services Rulebook) 

4. Exchange Services (Exchange Services Rulebook) 

5. Lending and Borrowing Services (Lending and Borrowing Services Rulebook) 

6. VA Management and Investment Services (VA Management and Investment Services Rulebook) 

7. VA Transfer and Settlement Services (VA Transfer and Settlement Services Rulebook) 

Each license application must comply with relevant requirements for capital, reporting, cybersecurity, and operational controls as specified in the rulebooks. 

C. Eligibility Criteria 

Key legal conditions include: 

1. Incorporation in Dubai or a free zone under the UAE Commercial Companies Law (Federal Decree-Law No. 32 of 2021). 

2. Fit and proper requirements for shareholders and officers, as laid out in the Company Rulebook. 

3. Physical presence and minimum operational infrastructure in Dubai⁵. 

4. Capital requirements are specific to the category of license. 

5. AML and cybersecurity readiness as required by the Compliance and Risk Management Rulebook and Technology and Information Rulebook⁶. 

D. Documentation Required 

Applicants are legally required to submit the following: 

1. Detailed business plan and scope of services. 

2. Organizational chart and UBO declarations as required by Cabinet Resolution No. (58) of 2020⁷. 

3. AML/CFT policies, in compliance with Federal Decree-Law No. (20) of 2018 and Cabinet Decision No. (10) of 2019⁸. 

4. Risk management framework and internal audit plan. 

5. Cybersecurity documentation aligned with VARA’s Technology and Information Rulebook⁹. 

E. Compliance Obligations 

AML/CFT Compliance 

As per Federal AML Law (Decree-Law No. 20 of 2018), all VASPs must: 

1. Conduct customer due diligence (CDD). 

2. Monitor transactions and report suspicious activity to the UAE Financial Intelligence Unit (FIU). 

3. Establish internal compliance functions and train staff accordingly¹⁰. 

Cybersecurity Compliance 

VARA mandates licensed entities to: 

1. Secure private keys and sensitive customer data. 

2. Maintain disaster recovery and business continuity plans. 

3. Comply with data localization and retention rules as detailed in the Technology and Information Rulebook¹¹. 

Market Conduct Compliance 

Under the Market Conduct Rulebook, VASPs must not: 

1. Make misleading statements about returns or risks. 

2. Fail to disclose material information to users. 

3. Engage in insider trading, manipulation, or unfair trading practices¹². 

F. Timelines and Licensing Process 

The licensing process typically spans three to six months, involving: 

1. Pre-application discussions with VARA. 

2. Formal submission of application and documents. 

3. Regulatory review and clarification stage. 

4. Grant of conditional approval. 

5. Final inspection and license issuance. 

This timeline can vary depending on the readiness of the applicant, the type of activity, and the complexity of operations. 

G. Penalties for Non-Compliance 

As per VARA’s enforcement provisions under Law No. 4 of 2022 and associated regulations: 

1. Fines may range from AED 200,000 to AED 20 million, depending on severity. 

2. Suspension or revocation of license for repeat or grave violations. 

3. Public enforcement actions, including blacklisting and referral to the Public Prosecution in cases of fraud or AML breaches¹³. 

Conclusion 

The UAE’s clear regulatory regime for crypto licensing creates an environment of trust, integrity, and innovation. However, obtaining and maintaining a crypto license in the UAE is a heavily regulated process, and requires full compliance with legal, operational, and technical frameworks. 

 

Disclaimer: The content of this blog is intended for informational purposes only and does not constitute formal legal advice. While every effort is made to ensure accuracy, the material is general in nature and may not reflect the most recent legal developments. No lawyer-client relationship is formed by reading or relying on this content. If you require legal assistance tailored to your specific situation, you are advised to consult directly through an appropriate channel. 

 

Legal Footnotes: 

1. Law No. (4) of 2022 Regulating Virtual Assets  

2. Virtual Assets and Related Activities Regulations 2023 (General Rulebook) 

3. Cabinet Decision No. (111) of 2022 Concerning Regulation of Virtual Assets 

4. VARA Rulebooks: Advisory, Broker-Dealer, Custody, Exchange, Lending and Borrowing, VA Management and Investment, Transfer and Settlement 

5. VARA Company Rulebook 

6. Compliance and Risk Management Rulebook & Technology and Information Rulebook 

7. Cabinet Resolution No. (58) of 2020 on UBO Disclosure 

8. Federal Decree-Law No. (20) of 2018 (AML), Cabinet Decision No. (10) of 2019 

9. Technology and Information Rulebook 

10. Compliance and Risk Management Rulebook; AML Law 

11. Technology and Information Rulebook 

12. Market Conduct Rulebook 

13. Law No. (4) of 2022; VARA Enforcement Guidelines