1. Bybit secures a VARA license for spot trading in Dubai
Bybit announced on October 22, 2026 that its Dubai-based entity, Bybit Fintech FZE, has received a Virtual Asset Service Provider (VASP) license from the Virtual Assets Regulatory Authority (VARA). The Bybit VARA license covers exchange services, specifically spot trading of cryptocurrencies, and adds to the approvals the exchange has collected as it expands outside its home markets.
The authorization allows the company to develop its activities inside Dubai's formal regulatory framework. Bybit has described itself as focused on compliance, security and risk management as it grows, and the new license is presented as part of that approach.
Spot trading is the most basic form of exchange activity: a customer buys or sells an asset at the current market price and takes ownership of it immediately. It differs from derivatives, in which participants trade contracts whose value depends on an underlying asset, often with leverage. Because the two activities carry different risks for customers, regulators frequently treat them separately, and Dubai's framework follows that logic.
For the exchange, a license to operate a spot venue in the emirate means that its activities there are carried out under the supervision of a dedicated authority rather than in a legal gray area. For customers, it means that a named regulator has reviewed the entity's structure and controls before allowing it to offer trading services.
2. Which Bybit entity holds the license?
The license was issued to Bybit Fintech FZE, the company's entity in the emirate. Bybit set up its international headquarters in Dubai in 2022, so the approval ties a regulatory permission to the place where the business already has a physical base.
Licensing a specific legal entity matters because regulators supervise companies, not brands. The permission applies to the activities that the named entity is authorized to carry out, and it carries the obligations that come with them, such as maintaining controls over customer assets, reporting and conduct rules. For users, a licensed entity gives a clearer answer to the question of who is responsible for a platform and which authority oversees it.
Dubai has positioned itself as a base for crypto businesses, and many exchanges have chosen to locate regional or international operations there. Setting up a headquarters in a jurisdiction with a purpose-built regulator gives a company a defined route to follow when it wants to obtain the permissions its business needs, which is part of what makes the emirate attractive compared with places where the rules are unsettled.
3. What is VARA and how does it license crypto firms?
VARA launched in 2022 and was described as one of the first standalone regulators created exclusively for virtual assets. Its framework sorts crypto businesses by the type of activity they carry out. The categories include exchange services, broker-dealer services, lending and custody, and each one requires a separate approval.
That structure has a practical consequence for companies like Bybit. A license for exchange services covers the operation of a trading venue, but it does not automatically extend to other regulated activities. A firm that wants to offer an additional product must obtain permission for it, which is why the company's current approval is limited to spot trading.
A licensing regime built around activities also allows a regulator to match its requirements to the risk involved. A custody provider, which holds assets on behalf of clients, faces questions about safekeeping and segregation of funds. A lending business must show how it manages credit and liquidity. An exchange has to demonstrate how it handles order matching, market surveillance and the protection of customer balances. Treating these as separate approvals lets the authority examine each one on its own terms.
The VASP label itself is common in crypto regulation worldwide. It describes a business that provides services involving virtual assets, such as exchanging them, transferring them or safeguarding them for others. Global standard setters have encouraged countries to require such firms to register or obtain a license, mainly so that they follow anti-money-laundering and counter-terrorist-financing rules in the same way banks do.
4. How does this fit Bybit's 2026 licensing push?
The Dubai license is part of a wider effort during 2026 that Bybit says has produced five new licenses and approvals. The jurisdictions named are the European Union, the Cayman Islands, Indonesia, South Africa and El Salvador. The VARA approval comes on top of that list and gives the exchange another regulated base in a major crypto hub.
For large exchanges, collecting licenses in several places has become a core part of strategy. Rules differ widely from one country to the next, and a platform that wants to serve customers across borders generally needs local permission in each market or must restrict its services there. A spread of approvals can reduce that friction and can reassure institutional counterparties, who often prefer to deal with supervised firms.
Bybit said it intends to keep working with regulators and to obtain the permissions it needs in the international markets where it operates. The company has not set out a timetable in its announcement, and each jurisdiction follows its own review process.
The practical effect of a multi-jurisdiction strategy is that a single exchange can end up running several regulated entities, each with its own compliance staff, reporting obligations and capital or governance requirements. That is costly, and it tends to favor larger platforms with the resources to maintain many licenses at once. Smaller competitors can find it harder to keep pace, which is one reason regulatory coverage has become a competitive advantage.
The announcement does not break down what each of the five other approvals permits, and the scope of each depends on local law. What it does show is the direction of travel: Bybit is describing its growth in terms of regulated access in named jurisdictions, from Europe and the Caribbean to Southeast Asia, Africa and Central America, rather than in terms of user numbers or trading volumes.
5. Why does the appointment of Peter Loo matter?
In August, Bybit named Peter Loo as its new chief legal and compliance officer. His remit covers global regulatory strategy, licensing and compliance, which makes him the executive most directly responsible for the kind of approvals announced this week.
Loo most recently served as general counsel and head of sector development at VARA, where he helped establish frameworks for virtual asset businesses. Earlier in his career he held senior positions at Barclays Capital, MF Global and Amber Group, leading legal and compliance work across Europe and the Middle East.
Hiring a former regulator into a compliance leadership role is a familiar move in financial services. Such executives know how supervisors evaluate applications and what they expect from firms once licensed. The announcement does not say how much his background influenced the outcome in Dubai, and it would be a mistake to read causation into the timing.
The company has linked Loo's statement on the approval to its broader emphasis on oversight and user protection. Those themes recur across the industry, in part because trust is the main obstacle for customers deciding where to keep funds. A regulated venue can point to formal supervision, while an unregulated one has to rely on its own assurances.
6. Can Bybit offer derivatives in Dubai?
Not yet. Loo said the approval reflects the importance of regulatory oversight and user protection, and he added that Bybit hopes to extend its licensed activities to derivatives trading. Derivatives, which include products such as futures and perpetual contracts, make up a major part of the exchange's global business.
Any such expansion would depend on additional regulatory approvals. Under VARA's activity-based approach, the current license for spot exchange services does not cover derivatives, so the company would need to seek permission for them separately. Whether and when that happens will be decided by the regulator.
The distinction is important for readers who might assume that a license for an exchange automatically covers every product the exchange sells. In Dubai's system, the scope of the approval defines what the firm may offer to customers within the emirate.
Derivatives trading has drawn particular attention from regulators in many countries because leverage can magnify losses for retail customers. Supervisors commonly ask for stronger disclosures, tighter risk controls and sometimes restrictions on who may access such products. That context explains why an exchange can hold approval for spot services and still need a second, distinct permission before launching futures or similar contracts.
Bybit has not said when it might apply for that permission, and the announcement gives no assurance that it will be granted. The statement is best understood as an expression of intent: the company wants the Dubai license to become the foundation for a wider range of regulated services, subject to what the authority decides.
7. What to watch after the approval
The next developments will be a matter of scope and follow-through. Observers will be watching whether Bybit applies for authorization to offer derivatives in Dubai, as Loo indicated it hopes to do, and how quickly the regulator responds. They will also be watching how the exchange rolls out spot services under the license, since regulated operation brings continuing duties on top of the initial approval.
Another point to follow is how the exchange communicates the change to its users in the emirate. A new license usually comes with specific terms covering which products are available, which customers may use them and what protections apply. Those details determine what the approval means in day-to-day use, and they are normally published by the licensed entity once services begin under the new authorization.
More broadly, the announcement shows how the competition among exchanges has shifted toward regulatory standing. Reaching users is no longer only a question of listing assets and lowering fees; it increasingly depends on holding the right permissions in the right places. Bybit's Dubai license, together with the five other approvals it cites for 2026, is its latest step in that direction.