Dubai’s Virtual Assets Regulatory Authority (VARA) has rolled out stricter governance standards for crypto trading and exchange‑traded derivatives. The rules are set out in an updated rulebook that establishes the first detailed framework for virtual‑asset derivatives on regulated exchanges in Dubai.
VARA says the framework aims to let innovation grow while keeping “governance and transparency requirements” front and center. General counsel Ruben Bombardi called derivatives “a natural next step” for virtual asset markets but said they “demand a higher standard of governance.”
New Standards for Leverage, Risk, and Client Checks
Under the new regime, any virtual asset service provider that wants to list or clear crypto derivatives must obtain specific authorization from VARA. The rulebook sets binding requirements in at least five areas, including client suitability checks and clear classification of retail, professional, and institutional customers.
Additionally, the framework mandates the separation of client assets from company capital, tightens margin and liquidation procedures, and caps retail leverage at about five times.
To help clients understand volatility, liquidation triggers, and counterparty exposure, exchanges must update risk disclosures and align all marketing with the actual product risks.
Stronger intervention powers are granted to VARA, which can limit the supply of goods, reduce leverage, or stop trading if it detects indications of market abuse or inadequate risk management. Trading venues must maintain thorough audit trails and conduct monitoring to identify insider dealing, manipulation, and wash trading.
Positioning Dubai as a Rules‑First Crypto Hub
Dubai created VARA in 2022 as a standalone regulator for virtual assets across the emirate, excluding the DIFC. Since then, it has built a layered rulebook that covers licensing, custody, market conduct, and marketing for exchanges, brokers, and custodians.
Bombardi said the derivatives framework “gives licensed providers a clear path to offering these products responsibly, while giving market participants confidence that Dubai’s virtual asset ecosystem operates under rules that are rigorous, enforceable, and designed to protect them.”
Industry lawyers note that many of the new governance and risk standards now align closely with what traditional capital‑markets regulators expect, which may help Dubai attract larger institutions seeking clearer guardrails for complex crypto products.
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