Kraken's parent entity, Payward FZCO, has received preliminary approval from the Virtual Asset Regulatory Authority (VARA) in Dubai to operate as a licensed virtual asset service provider (VASP) under the broker-dealer and investment and management licence categories. The approval enables the US-based exchange to serve both retail and professional clients in the emirate through a locally regulated subsidiary.
Services and client access
Under the licence, UAE-based clients will gain access to spot trading, margin trading, over-the-counter (OTC) trading, staking, and peer-to-peer crypto transfers via Kraken's Krak product. Institutional clients will also be able to access Kraken Prime, the exchange's offering for professional counterparties. Retail access will be governed by VARA's retail-specific rules, which limit the range of products available to non-professional clients.
Clients in the UAE will be connected to Kraken's global order books, which span markets in Europe, the US, and Asia-Pacific. The locally regulated structure also allows funding and withdrawal in UAE dirhams (AED), enabling fiat on- and off-ramping through a supervised entity rather than an offshore arrangement.
Looking ahead, Kraken has indicated plans to expand its UAE offering over time to include derivatives, lending, and new investment products for qualified clients, each subject to further regulatory approval from VARA.
Regulatory context and strategic rationale
VARA, established as Dubai's dedicated virtual asset regulator, has developed one of the more structured licensing frameworks for crypto businesses among global financial centres. The authority requires licensed entities to maintain segregated client assets and meet prescribed regulatory capital thresholds, conditions that Payward FZCO will be subject to under its authorisation.
For Kraken, the UAE entry follows a stated strategy of establishing regulated, on-the-ground operations in key financial markets. A company official noted that operating under VARA places Kraken within a locally supervised perimeter, as distinct from cross-border or offshore service provision. The official also indicated that the UAE's early adoption of a formal virtual asset rulebook has contributed to meaningful institutional capital concentration in the market.
The move reflects a broader pattern among major crypto exchanges seeking to secure jurisdictional licensing in regions where regulatory frameworks are already in place, as opposed to markets where the legal status of virtual assets remains unresolved.
