Nikolas Sargeant
Dubai's Virtual Assets Regulatory Authority (VARA) has published a formal regulatory framework for crypto exchange-traded derivatives (ETDs), setting out how licensed virtual asset service providers can offer the products in the emirate under Version 2.1 of VARA's Exchange Services Rulebook.
The framework covers client suitability assessments, leverage and margin controls, asset segregation, disclosure standards, and VARA's powers to intervene during periods of market stress or disorderly trading. In urgent scenarios, the regulator can require immediate action without prior notice — including suspending products, mandating position liquidations, or increasing margin requirements.
Both institutional and retail investors can participate, though retail access comes with meaningful restrictions. Clients must pass suitability assessments covering financial position, experience, and risk tolerance, and retail leverage is capped at 5:1, requiring a minimum 20% initial margin. That ceiling stands in sharp contrast to the leverage levels historically available on offshore platforms, Binance and Bybit have previously offered up to 100x on certain contracts.
The rules build on earlier regulatory experiments in Dubai. OKX ran a VARA-approved pilot in July 2025 offering retail access to futures, options, and perpetual contracts with up to 5x leverage. The new rulebook formalizes and standardizes those conditions across all licensed firms, extending clearer and enforceable requirements throughout the market.
VARA general counsel Ruben Bombardi said derivatives represent a natural evolution of virtual asset markets, but one that demands a higher standard of governance. The framework signals Dubai's intent to move beyond spot trading regulation and build out rules for the more complex and higher-risk corners of its crypto market.
