Table of Contents
Frequently Asked Questions
What is activity code 6619.86 and what does it cover
Activity code 6619.86 — Virtual Assets Lending and Borrowing Services falls within ISIC division 6619, which covers auxiliary financial services not classified elsewhere. It encompasses facilitating crypto-collateralised loans, operating yield-generating lending pools, and enabling clients to borrow against their digital asset holdings without liquidating positions.
Typical products under this licence include over-collateralised loans, institutional lending desks serving family offices and trading firms, and retail-facing borrowing platforms. Dubai classifies this as a financial auxiliary service because the operator intermediates or manages the lending infrastructure rather than acting as a direct lender in the traditional banking sense.
Who regulates virtual assets lending in Dubai
The primary regulator is the Virtual Assets Regulatory Authority (VARA), established under Law No. 4 of 2022. VARA has jurisdiction over all virtual asset service providers operating in or from Dubai, excluding the DIFC, and has published a dedicated rulebook specifically for lending and borrowing operators.
The Securities and Commodities Authority (SCA) retains oversight where lending products resemble securities or investment contracts, so operators structuring yield products or tokenised debt instruments should seek SCA guidance alongside VARA approval. The Central Bank of the UAE is also relevant where fiat conversion or stablecoin settlement is involved.
What are the two main operational models for a virtual assets lending business
There are two broad models. A custodial model involves the operator holding or controlling the borrower's digital assets as collateral during the loan period. A non-custodial model uses smart contract protocols to lock collateral without the operator taking direct custody.
This distinction carries significant compliance implications, particularly around custody arrangements, risk management frameworks, and client disclosure obligations that VARA requires operators to demonstrate before going live.
What AML and CFT obligations apply to virtual assets lenders in the UAE
AML/CFT compliance is non-negotiable for virtual asset lenders in the UAE. UAE Federal Decree-Law No. 20 of 2018 on anti-money laundering applies in full to all virtual asset firms.
Operators are subject to enhanced due diligence requirements, ongoing transaction monitoring, and suspicious activity reporting obligations. These requirements reflect the UAE's commitment to meeting international financial crime standards and are enforced as a condition of maintaining a VARA licence.
What does the UAE virtual assets market look like in terms of size and adoption
The UAE virtual assets market is projected to generate over USD 400 million in revenue by 2025, according to Statista. The country ranks among the top 10 globally for crypto adoption, driven by strong institutional and high-net-worth individual participation.
Dubai alone hosts over 600 registered virtual asset businesses across its free zones and mainland, reflecting the depth of the ecosystem. VARA issued its comprehensive Virtual Assets and Related Activities Regulations in 2023, covering lending as a distinct licensed activity and reinforcing the UAE's position as a mature regulatory environment.
What are VARA's fit-and-proper and capital requirements for lending operators
VARA applies fit-and-proper criteria to all principals, directors, and beneficial owners of a virtual assets lending business. This assessment covers professional background, financial integrity, and governance competence.
Minimum capital requirements vary by activity type and scale, but lending operations typically require a higher threshold than advisory or brokerage activities. Operators must also demonstrate robust policies covering custody arrangements, risk management frameworks, client disclosure standards, and collateral liquidation procedures before receiving approval.
Why is Dubai considered a strong jurisdiction for launching a virtual assets lending business
Dubai is one of the few jurisdictions globally where virtual assets lending is a licensed, regulated commercial activity rather than a grey area. The UAE has built a dedicated regulatory architecture — centred on VARA — that gives operators legal clarity, institutional credibility, and a compliant path to market.
The combination of a mature regulatory framework, high crypto adoption rates, a large base of institutional and HNW clients, and access to free zone structures like Meydan Free Zone makes Dubai particularly attractive for operators seeking a credible and scalable base for virtual assets lending.
What role does Meydan Free Zone play in setting up a virtual assets lending business
Meydan Free Zone is highlighted as a compliant path to market for operators looking to establish a virtual assets lending and borrowing business in Dubai. Free zones in the UAE offer streamlined company formation, 100% foreign ownership, and defined regulatory pathways for financial and technology-adjacent activities.
Setting up through a free zone like Meydan provides a structured commercial environment that aligns with VARA's licensing requirements, making it a practical starting point for operators who want to obtain activity code 6619.86 and operate within the UAE's regulated virtual assets framework.
How to Start a Virtual Assets Lending Business in Dubai
Most countries still cannot decide what crypto lending even is. Dubai decided. It is a licensed business here, with a regulator, a rulebook, and a clear way in.
This guide covers the Virtual Assets Lending and Borrowing Services license, activity code 6619.86. You will learn what the license lets you do, who checks up on you, and how to set up with Meydan Free Zone.
Key Stats at a Glance
What a Virtual Assets Lending License Covers
Activity code 6619.86 sits under ISIC division 6619, the bucket for financial support services that do not fit anywhere else. In plain terms, you help people borrow against crypto they already own.
What you can do. Arrange loans backed by crypto as collateral. Run lending pools that pay a yield. Let clients raise cash against their holdings without having to sell them.
What you are not. You are not a bank. You do not lend as a traditional lender does. You run the machinery: matching, managing and holding the loan together. That is why Dubai treats this as a support service rather than banking.
Typical products. Over-collateralised loans, where the borrower pledges crypto worth more than the loan. Lending desks serving family offices and trading firms. Retail platforms where everyday users borrow against their coins.
Custodial or Non-Custodial: Pick Your Model Early
There are two ways to run this, and the choice changes what the regulator asks of you.
Decide this before you apply. It shapes your capital, your policies and your whole application.
Who Regulates Crypto Lending in Dubai
VARA came out of Law No. 4 of 2022 and covers every virtual asset firm working in or from Dubai. For lending, it has published a rulebook you have to line up with before you go live.
Anti-money laundering rules are not optional. UAE Federal Decree-Law No. 20 of 2018 applies to you in full. That means deeper checks on customers, monitoring of transactions, and reporting anything that looks off.
What VARA Will Ask You For
Your people. VARA runs fit and proper checks on every principal, director and beneficial owner. It looks at your background, your money and how well you run things.
Your capital. The minimum depends on what you do and how big you are. Lending usually needs more capital than advice or broking.
Your policies. You need written policies on how you hold assets, how you manage risk, what you tell clients, and how you sell collateral if a loan goes bad.
Your compliance officer. You need one from day one, and they need real virtual asset experience.
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Who Your Customers Are
The UAE holds a deep pool of institutions, wealthy individuals and crypto native firms sitting on large digital holdings. Many of them want cash without selling. They want to buy property, fund a business, or make another investment, and still keep their crypto position.
Traders. They need short term capital to keep positions open.
Family offices. They run mixed portfolios and want liquidity without breaking them up.
Crypto businesses. They borrow working capital against their own treasury.
Dubai sits between Asian and European money flows. That gives you a client base most other places cannot reach. Invest in Dubai publishes sector data that backs up the digital economy case if you want to dig further.
How to Set Up with Meydan Free Zone, Step by Step
Meydan Free Zone supports activity code 6619.86 and gives financial services firms a clear route in. Here is how it runs:
- Step 1, confirm your activity: Set 6619.86 as your main activity. Check with the Meydan Free Zone team whether anything else you plan to do, such as custody or exchange, needs its own license.
- Step 2, pick your structure: A Free Zone Limited Liability Company (FZ-LLC) is the standard choice for financial services. It separates your liability and VARA recognises it for licensing.
- Step 3, get your papers ready: Send in passport copies, proof of address, a full business plan, and your compliance framework. VARA will read the business plan closely, so write what you will actually do, not what you hope to do.
- Step 4, get your trade license: Meydan Free Zone issues this once your documents are approved. Your company now legally exists, and you cannot apply to VARA without it.
- Step 5, apply to VARA: File your application with your trade license, your compliance policies, and proof you hold enough capital. VARA may want to interview the people running the business.
- Step 6, open your bank account: Banks look hard at crypto firms. Go in with a full pack: business plan, source of funds, and compliance policies. Some firms work with banking partners who already know the sector.
- Step 7, sort visas and space: Meydan Free Zone offers flexi-desk and dedicated office options. Your visa allowance is tied to your package and covers founders, directors and key staff.
A few services worth knowing about: mResidency handles visas for you, your team and your family. mAccounting keeps your books clean, which helps at both bank and VARA stage. mCore, mAssist and mPlus cover the wider support once you are trading.
Conclusion
Crypto lending works as a business in Dubai, but it asks for real discipline from day one. The rules exist. The market is busy. The demand from institutions and wealthy clients is real.
What separates the firms that get going from the ones that stall is preparation: a compliance framework that holds up, enough capital, and a clear read on what VARA expects before you file anything.
Meydan Free Zone gives you a workable base for all of it, with direct access to the licensing route and the setup to run a regulated financial services business. Talk to the team to check your activity scope and start your license application.
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