Table of Contents
Frequently Asked Questions
Do I need a license to lend against crypto in Dubai?
Yes. Any lending or borrowing service in virtual assets provided in or from Dubai, outside the DIFC, requires VARA approval under activity 6619.86 before Meydan Free Zone can issue the business license. Operating without approval is not permitted.
Can I hold the collateral myself?
Not as a licensed custodian. Custody is activity 6619.84 and cannot be combined with lending, so the arrangement for holding pledged collateral needs to be structured with that separation in mind and confirmed with VARA during the application.
What is the difference between lending and yield products?
Both fall under activity 6619.86. Collateralised lending advances funds against pledged assets. Yield programmes borrow assets from holders and pay a return. The regulatory category is the same; the disclosure obligations for yield products are heavier.
Can I combine lending with exchange or brokerage?
Yes. Activity 6619.86 may be combined with advisory, broker-dealer, exchange, management and investment, and transfer and settlement. Only proprietary trading and custody are excluded, and VARA assesses each combination individually.
What risk controls does VARA expect from a lender?
Documented collateral valuation and haircut policy, defined margin and liquidation triggers, counterparty credit assessment, and clear client disclosure of what happens in a default or a sharp market move. The detailed requirements sit in VARA's rulebooks.
Is this the same as a conventional lending license?
No. Conventional credit granting falls under the 6492 codes and requires Central Bank initial approval. Activity 6619.86 covers lending and borrowing in virtual assets specifically and falls under VARA's authority instead.
How to Start a Virtual Assets Lending and Borrowing Services Business with Meydan Free Zone
Lending against digital assets is credit business with unfamiliar collateral. A borrower pledges virtual assets and receives funds, or pledges funds and receives assets. The lender prices the risk, sets the margin, monitors the collateral and liquidates if it falls short. Activity 6619.86 is the license for running that book in Dubai.
Credit follows capital, and the capital is here. Virtual assets contributed roughly 0.5 percent of Dubai's gross domestic product in 2025, around AED 2.2 billion, and the Higher Committee for the Development of the Economic and Financial Sector has targeted a rise to 3 percent, close to AED 13 billion[1]. Assets under management across VARA-regulated entities exceeded AED 9.6 billion in the same year[2], against transaction volumes approaching AED 2.5 trillion[3].
Lending is where virtual asset businesses have historically failed hardest, which is exactly why the regulated version matters. VARA, established under Dubai Law No. 4 of 2022 as the world's first dedicated virtual assets regulator[4], requires approval before any lending or borrowing product reaches a client. Operating without it is not an option in Dubai.
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A Sector Targeted to Grow Sixfold as a Share of GDP
A Dubai-licensed lender operates in a market where virtual assets contributed around AED 2.2 billion, or 0.5 percent of the emirate's GDP in 2025, against an official target of 3 percent worth close to AED 13 billion, with assets under management across regulated entities exceeding AED 9.6 billion.
Sources: Higher Committee for the Development of the Economic and Financial Sector (2025), Virtual Assets Regulatory Authority, Dubai Government Media Office
Who Is This Activity For?
6619.86 - Virtual Assets Lending and Borrowing Services
This activity sits within the broader class of other activities auxiliary to financial service activities, which covers firms that support financial markets without acting as a bank or insurer. Activity 6619.86 is the credit member of the virtual asset group inside it.
Under code 6619.86 you are licensed to offer lending and borrowing services in virtual assets: lending to clients against collateral, borrowing assets from clients, and operating the credit arrangements that sit between the two. The boundary is that the arrangement is a credit relationship. You are not safeguarding assets as a custodian, and you are not managing a portfolio on a client's behalf.
Beyond this activity, Meydan Free Zone also supports related licences such as Virtual Assets Management and Investment Services, Virtual Assets Custody Services, and Virtual Assets Broker-Dealer Services.
A Virtual Assets Lending and Borrowing Services license typically covers:
- Lending fiat or virtual assets to clients against virtual asset collateral
- Borrowing virtual assets from clients under defined terms and return arrangements
- Collateral valuation, margining and haircut policy
- Margin calls, liquidation triggers and enforcement procedures
- Credit assessment and counterparty due diligence
- Loan origination, documentation, servicing and repayment administration
- Risk disclosure and client communication on lending and borrowing terms
Service Scope
Collateralised Lending
Advancing funds against pledged virtual assets, with a loan-to-value ratio, margin thresholds and automated liquidation if collateral value falls. The whole business is collateral discipline: how it is valued, how quickly it can be realised, and what happens in a market where everyone is liquidating at once.
Institutional Credit and Asset Borrowing
Providing financing and asset borrowing to funds, market makers and trading firms. Loans are negotiated rather than automated, counterparty assessment carries most of the weight, and terms reflect the specific strategy being financed rather than a published rate card.
Borrowing and Yield Programmes
Taking assets from holders under a borrowing arrangement and paying a return. This is the model with the worst historical record globally, and the regulated version is defined by disclosure: clients need to understand where their assets go, what secures the return and what they lose if the arrangement fails.
WHAT THIS ACTIVITY EXCLUDES
It is important to note what activity 6619.86 does not cover. Safekeeping client assets is 6619.84, Virtual Assets Custody Services, which cannot be combined with lending, so collateral held under a lending arrangement is a separate matter from licensed custody and must be structured accordingly. Managing a client portfolio with discretion is 6619.87. Executing client orders is 6619.83, and operating a trading venue is 6619.85. Advising clients on borrowing decisions without providing the credit is 6619.82. Moving and settling assets for third parties is 6619.88. Trading on your own account is 6619.81 and cannot be combined with anything. Conventional credit granting sits under the 6492 codes and requires Central Bank approval rather than VARA approval.
In short: if you are extending or taking credit in virtual assets, you are in. If you are safekeeping the collateral as a custodian, managing a portfolio or executing trades, you are not.
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Licensing & Compliance
Third-Party Approval:
You need approval from the Virtual Assets Regulatory Authority (VARA) before your business license is issued. This activity cannot be combined with Virtual Assets Proprietary Trading in Crypto-commodities or Virtual Assets Custody Services.
Anti-Money Laundering Compliance:
This business activity is exempt from AML compliance requirement.
References
[1] GCC Business Watch, reporting the Higher Committee for the Development of the Economic and Financial Sector on Dubai Financial Market performance and virtual asset GDP contribution. gccbusinesswatch.com
[2] Arabian Business, Dubai VARA reports $681bn in virtual asset volumes, reporting VARA figures for 2025, November 2025. arabianbusiness.com
[3] AGBI, Tokenisation fuels Dubai's virtual asset growth, says regulator, citing Dubai Government Media Office, July 2026. agbi.com
[4] The Official Portal of the UAE Government, Regulation of digital properties, on Dubai Law No. 4 of 2022 and the establishment of VARA. u.ae
[5] Virtual Assets Regulatory Authority, Licence Applications, on the two-stage licensing process and submission through a Dubai free zone authority. vara.ae
