Dubai’s Derivatives Framework: VARA Is Now Open For Crypto Futures, Perps, Options And CFDs

KEY TAKEAWAYS 

• Exchange Traded Derivative Services require explicit VARA authorisation in the licence; they are not automatic for Exchange Services licensees. 
• Retail clients face a maximum of 5:1 leverage (minimum 20% initial margin), and suitability must be assessed initially and ongoing; unsuitable clients must be blocked immediately. 
• The close-out waterfall includes monitoring, margin call, liquidation, then client shortfall responsibility, then Insurance Fund usage, only then mutualisation, ensures that client losses are first allocated to the failing client, then buffered by the Insurance Fund, before mutualising across non-defaulting clients. 
• Non-ETD clients cannot be exposed to ETD losses and cannot be required to contribute to Insurance Funds.