Dubai’s Virtual Assets Regulatory Authority (VARA) has published Version 2.1 of its Exchange Services Rulebook, establishing a formal regulatory framework for crypto exchange-traded derivatives (ETDs) offered in the emirate. The rules set out requirements for licensed virtual asset service providers (VASPs) covering client suitability, leverage and margin controls, asset segregation, disclosure standards and the regulator’s powers to intervene in stressed markets.
Scope and governance
The framework applies to VASPs licensed to provide exchange services in Dubai and formalizes guardrails for a higher-risk segment of crypto markets as trading expands beyond spot instruments. VARA’s general counsel Ruben Bombardi said derivatives ‘‘demand a higher standard of governance’’ as part of the market’s evolution.
Retail access under limits
VARA allows both institutional and retail participation, but retail access is controlled by a risk-based suitability regime. Firms must perform strict suitability assessments that consider an investor’s experience, financial position and risk tolerance, and provide enhanced disclosures about product risks. Retail leverage is capped at 5:1 (a minimum initial margin of 20%), and firms are required to restrict access where products are inappropriate for certain client segments. That 5:1 cap is materially more conservative than leverage available on some offshore platforms, where exchanges have at times offered up to 100x or more.
Risk controls and regulatory intervention
The rulebook gives VARA broad powers to act during market stress or disorderly trading. Possible measures include suspending products, requiring position liquidations, increasing margin requirements and mandating stronger risk controls such as insurance funds. In urgent circumstances the regulator can demand immediate remedial action without prior notice to limit systemic disruption.
Context and rollout
The rulebook builds on earlier UAE initiatives to regulate crypto derivatives. In 2024 some platforms limited derivatives to qualified or institutional clients under strict thresholds. In mid-2025 OKX ran a pilot allowing retail access to futures, options and perpetuals under a VARA framework with up to 5x leverage. VARA’s new rules formalize and standardize those experiments, expanding access under clearer, enforceable conditions.
The new framework aims to balance market development with consumer protection by enabling broader participation while imposing risk limits, stronger governance and explicit supervisory remedies for market stress.