Virtual Asset Custody Services Licence (Dubai (VARA))
The Virtual Asset Custody Services Licence authorises safekeeping of clients' virtual assets and private keys in Dubai. VARA requires it to sit in its own segregated legal entity: the only licensed activity with this rule. Paid-up capital is AED 600,000 (or 25% of overheads); Reserve Assets must cover 100% of client liabilities 1:1. Application fee AED 100,000, annual AED 200,000; VARA sets no fixed decision deadline.
At a glance
| Official name | Virtual Asset Custody Services Licence1 |
|---|---|
| Also known as | VARA custody licence · Dubai crypto custody licence · VA Custody Services licence |
| Issued by | Virtual Assets Regulatory Authority |
| Jurisdiction | Dubai (VARA) |
| Licence family | Virtual asset service provider (non-MiCA) |
| Legal basis | Law No. (4) of 2022 Regulating Virtual Assets in the Emirate of Dubai2 Cabinet Decision No. 111/2022 on the Regulation of Virtual Assets and Their Service Providers3 Cabinet Decision No. 112/2022 on Delegating Certain Competencies related to the Regulation of Virtual Assets4 |
| Passporting | Domestic only |
| Minimum capital | AED 600,000, or 25% of fixed annual overheads, whichever is higher5 |
| Application fee | AED 100,0006 |
| Annual fee | AED 200,0006 |
| Statutory decision time | No fixed statutory determination deadline is prescribed by Law No. (4) of 2022 or Regulations 2023; VARA exercises discretionary review based on submission completeness.7 |
| Public register | official register8 |
| Current holders | 68 |
What it lets you do
| Custody and administration of crypto-assets | Safekeeping or controlling crypto-assets, or the means of access to them such as private keys, on behalf of clients. |
|---|---|
| Virtual asset safekeeping (FATF) | Safekeeping or administering virtual assets, or instruments enabling control over them, for another person. |
Where it is valid
Requirements
| Requirement | What is needed | Legal reference |
|---|---|---|
| Capital and people assessed | ||
| Minimum capital | AED 600,000, or 25% of fixed annual overheads, whichever is higher5 | |
| Ongoing own funds | Net Liquid Assets must be maintained at all times at no less than 1.2x monthly operating expenses, reconciled daily and reported to VARA monthly. In addition, Reserve Assets equal to 100% of the liabilities owed to clients must be held on a strict 1:1 basis in the same virtual asset as the liability, reconciled daily and audited by an independent third-party auditor at least every six months.9 | |
| Who is assessed | Every Board member is individually vetted and approved by VARA as Fit and Proper on appointment and re-assessed at least annually. The two Responsible Individuals and Senior Management are vetted the same way at licensing. Controlling Entities and Ultimate Beneficial Owners must be identifiable in the ownership chain and declared free of PEP/sanctions exposure; any party reaching 25% or more of voting rights or equivalent control is treated as a Controlling Entity.10 | |
| Substance and people | ||
| Client assets | Virtual Asset Custody Services is the only VARA-regulated activity that must be carried out through a structurally segregated, standalone legal entity holding its own dedicated VASP licence: it cannot be combined with other licensed activities in the same company.1 | |
| Management and people | The VASP must maintain two Responsible Individuals: full-time employees who are Fit and Proper and are either UAE residents or UAE passport holders: notified to and approved by VARA during the licensing process.11 | |
| Management and people | Every Board member must be individually assessed by the VASP and approved by VARA as a Fit and Proper Person, with the Board re-confirming each member's status at least annually.10 | |
| AML/CFT | A Money Laundering Reporting Officer with at least two years' AML/CFT experience must be appointed and confirmed Fit and Proper; the MLRO reports to the Board quarterly on AML/CFT policy effectiveness, may hold other non-client-facing roles, and AML/CFT tasks may be outsourced only if the MLRO remains fully accountable.12 | |
| Local presence | The licensee must be incorporated in Dubai and hold a VARA Permit before it may obtain the underlying commercial licence or commence virtual asset business.2 | |
| Conditions to keep the licence | ||
| Withdrawal | VARA may vary, suspend (for up to six months) or revoke the Licence/Permit for material regulatory breach, insolvency, an unpaid court judgment, or other good cause, alongside cancellation of the underlying commercial licence.2 | |
| Audit | Reserve Assets equal to 100% of client liabilities must be held 1:1 in the same virtual asset, reconciled daily, and independently audited at least every six months.9 | |
| Reporting | Net Liquid Assets must be reconciled daily and reported to VARA monthly, maintained at no less than 1.2x monthly operating expenses at all times.13 | |
| Requirement | Controlling Entities and Ultimate Beneficial Owners must be kept identifiable in the ownership chain and declared free of Politically Exposed Person or sanctions status.14 | |
Cost
Buying a company that already holds it
The VARA Permit/Licence itself is not transferable or assignable to another party without VARA's prior approval; an unauthorised assignment is null and void (Article 17, Law No. (4) of 2022). A change of ownership is instead effected as a share or asset deal in the licensed custodian entity, which separately requires VARA's prior written approval once 25% or more of voting rights or equivalent control passes to the acquirer (see change_of_control).2
Prior approval required. Under Company Rulebook Part VIII.C, no action may be taken that may result in a change of Control of a VASP without VARA's prior written approval. Prior to any transaction, the VASP and acquirer must submit a joint written application. Control is presumed when an entity directly or indirectly owns or controls 25% or more of voting shares, possesses power to direct management/policies, or can appoint or dismiss the majority of the Board or Senior Management. The statutory assessment period is thirty (30) Working Days from deemed receipt of a complete application, extendable by VARA. Assessments consider public interest, investment vs controlling intent, board influence, and fit-and-proper standards.15
Ready-made companies holding this licence: see verified positions.
VASP in other countries
| Country | Licence | Regulator | Min. capital | Application fee | Statutory time |
|---|---|---|---|---|---|
| Abu Dhabi Global Market (ADGM) | VASP licenceFinancial Services Permission with Virtual Asset Activities Endorsement | FSRA | USD 250,000 | USD 20,000 | n/a |
| Australia | VASP licenceRegistration as a virtual asset service provider (VASP) on the AUSTRAC Virtual Asset Service Provider Register (formerly the Digital Currency Exchange Register) | AUSTRAC | n/a | n/a | n/a |
| Bermuda | Digital Asset Business Class F (Full) Licence | BMA | n/a | n/a | n/a |
| Bermuda | Digital Asset Business Class M (Modified) Licence | BMA | n/a | n/a | n/a |
| Bermuda | Digital Asset Business Class T (Test) Licence | BMA | n/a | n/a | n/a |
| British Virgin Islands | Virtual Assets Service Provider Registration | BVI FSC | n/a | n/a | n/a |
| Cayman Islands | Virtual Asset Service Provider Licence | CIMA | n/a | KYD 5,000 | n/a |
| Cayman Islands | Virtual Asset Service Provider Registration | CIMA | n/a | KYD 1,000 | n/a |
| Dubai (VARA) | Virtual Asset Advisory Services Licence | VARA | AED 100,000 | AED 40,000 | n/a |
| Dubai (VARA) | Virtual Asset Broker-Dealer Services Licence | VARA | AED 600,000 | AED 100,000 | n/a |
| Dubai (VARA) | Virtual Asset Custody Services Licence | VARA | AED 600,000 | AED 100,000 | n/a |
| Dubai (VARA) | Virtual Asset Exchange Services Licence | VARA | AED 1,500,000 | AED 100,000 | n/a |
| Dubai (VARA) | Virtual Asset Lending and Borrowing Services Licence | VARA | AED 500,000 | AED 100,000 | n/a |
| Dubai (VARA) | Virtual Asset Management and Investment Services Licence | VARA | AED 500,000 | AED 100,000 | n/a |
| Dubai (VARA) | Virtual Asset Transfer and Settlement Services Licence | VARA | AED 500,000 | AED 40,000 | n/a |
| Dubai International Financial Centre (DIFC) | Financial Services Permission with Crypto Token Activities Endorsement | DFSA | USD 1,000,000 | USD 15,000 | n/a |
| El Salvador | Proveedor de Servicios de Activos Digitales (PSAD) registration | CNAD | USD 2,000 | USD 5,475 | ~0.9 mo |
| Germany | Qualified crypto custody licence | BaFin | n/a | n/a | n/a |
| Ireland | Virtual Asset Service Provider AML/CFT Registration | CBI | n/a | n/a | n/a |
| Mauritius | Virtual Asset Advisory Services (Class I) | FSC | n/a | n/a | n/a |
| Mauritius | Virtual Asset Broker-Dealer (Class M) | FSC | n/a | MUR 2,000,000 | n/a |
| Mauritius | Virtual Asset Wallet Services (Class O) | FSC | n/a | n/a | n/a |
| Mauritius | Virtual Asset Custodian (Class R) | FSC | n/a | MUR 5,000,000 | n/a |
| Mauritius | Virtual Asset Market Place (Class S) | FSC | n/a | MUR 6,500,000 | n/a |
| Seychelles | Virtual Asset Service Provider Licence / RegistrationVirtual Asset Service Provider Licence / Registration (Wallet Provider, Exchange, Broking, Investment Provider) under the Virtual Asset Service Providers Act 2024 | FSA | n/a | SCR 75,000 | n/a |
| South Africa | Crypto Asset Service Provider licenceCrypto Asset Service Provider licence (an FSP authorisation category under FAIS, not a MiCA-equivalent regime) | FSCA | n/a | n/a | n/a |
| Switzerland | Financial intermediary / VASP SRO affiliation | FINMA | CHF 10,000,000 | CHF 1,600 | n/a |
| United Kingdom | Cryptoasset Business Registration (MLRs 2017) | FCA | n/a | GBP 11,260 | ~3 mo |
Values come from each licence's page, where every figure has its source.
Laws behind it
- Law No. (4) of 2022 Regulating Virtual Assets in the Emirate of Dubai: Law No. (4) of 2022
- Virtual Assets and Related Activities Regulations 2023: Virtual Assets and Related Activities Regulations 2023
Getting this licence
Protegra handles this licence end to end: crypto licensing in Dubai (VARA): process, timeline and our fee.
Frequently asked questions
Why does a VARA custody licence need its own legal entity?
VARA's Company Rulebook singles out Virtual Asset Custody Services as the only regulated activity that must be structurally segregated into a standalone company with its own licence. A firm that also runs, say, a broker-dealer or exchange business must house custody in a separate legal entity rather than under one licence.
How much capital is needed for a VARA custody licence?
Paid-up capital under Company Rulebook Rule VI.B is the higher of AED 600,000 or 25% of the custodian's fixed annual overheads, held at all times. Unlike broker-dealer or exchange licences, custody carries no reduced capital tier, since the custodian is itself the party safeguarding client assets.
How does VARA make sure a custodian actually holds client assets?
The custodian must hold Reserve Assets equal to 100% of what it owes clients, on a strict one-to-one basis in the same virtual asset as the liability. Reserve Assets are reconciled daily and must be independently audited by a third party at least once every six months.
How long does a VARA custody licence application take?
Neither Law No. (4) of 2022 nor the 2023 Regulations set a statutory decision deadline; VARA reviews custody applications at its discretion based on completeness, following the same two-stage Initial Disclosure Questionnaire and full-licensing process as other VASP activities.
Can a VARA custody licence be sold with the business?
The licence itself cannot be assigned: Article 17 of Law No. (4) of 2022 voids any unauthorised transfer. Ownership instead changes through a share or asset deal in the licensed custodian entity, and any transaction crossing 25% of voting rights or control needs VARA's prior written approval.
Sources
- vara.ae: licensed activities · retrieved 2026-09-24
- VARA Rulebooks: law no 4 2022 regulating virtual assets emirate dubai · retrieved 2026-09-24
- VARA Rulebooks: cabinet decision no 1112022 regulation virtual assets and th · retrieved 2026-09-24
- VARA Rulebooks: cabinet decision no 1122022 delegating certain competencies · retrieved 2026-09-24
- VARA Rulebooks: b paid capital · retrieved 2026-09-24
- VARA Rulebooks: schedule 2 supervision and authorisation fees · retrieved 2026-09-24
- VARA Rulebooks: b varas licensing and authorisation powers · retrieved 2026-09-24
- vara.ae: public register · retrieved 2026-09-24
- VARA Rulebooks: e reserve assets · retrieved 2026-09-24
- VARA Rulebooks: b board · retrieved 2026-09-24
- VARA Rulebooks: c responsible individuals · retrieved 2026-09-24
- VARA Rulebooks: appointment and duties money laundering reporting officer · retrieved 2026-09-24
- VARA Rulebooks: c net liquid assets · retrieved 2026-09-24
- VARA Rulebooks: company ownership structure · retrieved 2026-09-24
- VARA Rulebooks: c change control · retrieved 2026-09-24
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