Thinking about launching or scaling a crypto business in Dubai? This guide gives a plain-English overview of what a VARA authorization means in practice, which models it suits, what documentation and controls reviewers expect to see, and a clean way to sequence your rollout without rework. If you want a structured start point, see Dubai VARA license for a step-by-step service overview.
Why teams choose Dubai in 2025
- Global hub: strong investor, talent, and partner base, plus direct access to MENA and Asian corridors.
- Specialized regulator: a dedicated virtual assets authority focused on structured, transparent oversight.
- Operational advantages: modern infrastructure, straightforward corporate setup, and deep professional-services support.
- Brand signal: a recognized licensing path that counterparties understand, useful for banking, partners, and enterprise clients.
Who VARA suits (and when it doesn’t)
Good fit:
- Custodial businesses: hosted wallets, platforms that control client keys, or services that safeguard client assets.
- Exchange/market models: retail or pro trading, brokerage/OTC, order routing, or similar marketplace features.
- Payment/transfer rails: businesses that move client crypto between users or external wallets, or operate on/off-ramps.
- B2B infrastructure: providers building custody, settlement, or compliance rails for other crypto companies.
Poor fit:
- Purely non-custodial tools that never touch client funds and have no brokerage/matching—these may not need the same authorization footprint (still confirm scope before you decide).
- Experiments with unclear flows—if you can’t diagram onboarding → funding → action → withdrawal, expect prolonged reviews.
What reviewers expect to see (the foundations)
Successful files tend to share the same building blocks:
- Clear corporate structure: directors, officers, significant owners disclosed; governance and decision-making lines mapped.
- Named Compliance Officer with real authority and direct access to top management.
- Documented AML/CTF program: KYC/KYB standards, sanctions screening, transaction monitoring, suspicious activity reporting, Travel Rule handling, and recordkeeping.
- Business-model risk assessment: customers, products, channels, geographies; mitigations that are actually implemented.
- Technology & security pack: wallet architecture, key management (HSM/multisig), hot/cold segregation, incident response, vendor controls, and change-management discipline.
- Custody & safeguarding: dual controls on withdrawals, reconciliation cadence, and separation of client vs company assets.
- Disclosures & conduct: client agreements, risk summaries, fee schedule, complaint handling, and marketing standards.
- Financial resilience: realistic budget, capital/insurance posture that matches the risk profile, and continuity planning.
KYC, Travel Rule, and ongoing monitoring
Build controls into the product from day one:
- KYC/KYB: verify retail users; collect corporate docs and UBOs for business accounts; risk-rate and refresh on a schedule.
- Sanctions screening: at onboarding and continuously for users, counterparties, and key vendors.
- Travel Rule: transmit originator/beneficiary data on qualifying transfers; use a provider or interop method that works across your main corridors.
- Transaction monitoring: rules + machine assistance; typologies for mixers, mules, darknet exposure; case management and escalation to SAR/STR where applicable.
- Recordkeeping: auditable logs for onboarding, risk decisions, transfers, alerts, and outcomes with the required retention.
Architecture choices that change your burden
Pick the simplest version of your model that meets your go-to-market goals:
- Non-custodial app (no key control): lower custody risk; still map for embedded brokerage or routing.
- Custodial wallet: higher safeguards; implement withdrawal approvals, allow-lists, velocity controls, and strong key governance.
- Exchange/OTC: “market” features often trigger the most extensive obligations; keep v1 narrow (e.g., spot only) to move faster.
- Payments/remittance: emphasize Travel Rule, sanctions, source-of-funds, and monitoring on both sides of the flow.
Documents checklist (typical)
- Corporate: articles, registers, org chart, shareholder agreements (if any).
- Ownership & management: ID, address, CVs for directors/officers/UBOs; fit-and-proper confirmations where applicable.
- Business plan: products, target segments, jurisdictions, corridors, economics, and a realistic growth path.
- Compliance program: AML/CTF manual, sanctions policy, KYC/KYB standards, Travel Rule method, monitoring procedures, escalation/STR flow, training plan.
- Technology & security: wallet/key design, vendor matrix and due diligence, incident playbooks, pen-test policy, and change control.
- Custody & safeguarding: hot/cold policy, approvals, reconciliation, and (if applicable) insurance evidence.
- Financials: 12–24-month budget, capital policy, liquidity runway, and continuity scenarios.
- Customer docs: T&Cs, risk disclosures, fee schedule, fair-marketing standard, and complaints handling.
Timeline and sequencing (avoid dead-ends)
- Model mapping & scope (1–2 weeks): diagram onboarding → funding → action → withdrawal; decide custodial vs non-custodial; list corridors and partners.
- Policy drafting (2–4 weeks): build AML/CTF, Travel Rule, monitoring, custody, and security policies that match the actual product flows.
- Pre-filing alignment (1–2 weeks): appoint the Compliance Officer; confirm vendors (KYC, Travel Rule, custody tech); tidy the org chart and decision rights.
- Submission & clarifications: file a complete pack; respond with short, evidenced answers (policy excerpt, screen, log) to keep momentum.
- Go-live readiness (parallel): integrate vendors, test approvals, run tabletop incident drills, finalize reporting templates.
Keep v1 tight. Each extra feature (derivatives, leverage, margin lending) adds complexity and slows time-to-market.
Banking, EMIs, and PSPs
Every provider will ask two questions: Can you keep illicit funds out? and Can you safeguard client assets? Strengthen your case by showing:
- Segregation of client vs company assets; reconciliation and access controls.
- Travel Rule coverage for inbound and outbound transfers.
- Counterparty policy for exchanges, market makers, custodians, and brokers you rely on.
- Monitoring in action: thresholds, alerts, case notes, and an escalation trail.
Many teams open with a fintech-friendly EMI/PSP for daily operations and add a traditional bank for redundancy and currencies. Choose partners that explicitly support your industry and corridors.
Cost buckets (budget the right way)
- One-off setup: advisory/policy drafting, application prep, and legal reviews.
- Technology & security: KYC/KYB vendor, Travel Rule solution, custody tooling, monitoring stack, security testing.
- Ongoing compliance: officer time, audits, transaction monitoring, reporting, training, renewals.
A bucketed budget prevents false economies that lead to remediation and delays later.
Risk checklist (five things that stall approvals)
- Policy–product mismatch: manuals say one thing, the app does another. Align screenshots and flows to the text.
- Weak custody narrative: unclear key management, no dual controls, no reconciliation routine.
- Travel Rule “later”: vague future intent isn’t enough—pick a solution and show how it works.
- Entity role confusion: cross-border group with fuzzy service maps; document who serves which customers.
- Under-scoped monitoring: no typologies for your real corridors; no case notes; no evidence of escalation.
FAQ
Do all crypto businesses in Dubai need the same authorization?
No—requirements depend on your activities, whether you touch client assets, and whether you run exchange/market features. Map your model first.
Can a non-custodial app avoid the heaviest lift?
Often lighter, yes—but embedded brokerage, matching, or settlement features may still bring you into scope. Validate before you build.
How long does it take?
Timelines vary by completeness and complexity. Clean files that match product reality move faster; leave buffer for clarifications.
What do banks want to see?
Evidence you can keep illicit funds out, safeguard client assets, and operate reliably: segregation, monitoring, Travel Rule, and incident playbooks.
Can we expand cross-border later?
Yes—document roles across entities and corridors now to make future licensing and banking smoother.
Who can help
LegalBison is an international advisory firm that helps crypto and fintech teams obtain the permissions they need, design workable compliance programs, and secure banking. The team blends legal precision with practical build-out so founders can launch safely and scale with confidence. Learn more at legalbison.com.
