MiCA and VARA a comparison for crypto exchanges in 2026

MiCA is a pan-European regulation covering crypto-assets, tokens and CASP services: exchange, trading platform operation, custody, token issuance and order execution. By 2026 MiCA harmonizes rules for stablecoins, tightens requirements on transparency, risk management and minimum capital. An important feature: MiCA passporting for operating in the EU — by obtaining a license in one EU country and complying with corporate and prudential standards, you can serve clients across the European Economic Area.

VARA has created a modular licensing system for VASPs in Dubai: advisory, broker‑dealer, custody, exchange, lending/borrowing, management & investment. The rules are divided into knowledge and process areas: Company, Compliance & Risk, Market Conduct, Technology & Information, as well as an Issuance Rulebook for tokens. By 2026 VARA is expected to consolidate the rulebooks, clarify third‑country equivalence and strengthen requirements for managing technology risks, including operational SLAs with wallet providers and access control.

MiCA and VARA have extraterritorial elements: marketing, interface availability, client targeting and onboarding create compliance obligations. VARA is developing an approach of international recognition and third‑country equivalence, but it does not remove local Licensing where there is a physical presence, a management center or targeted marketing. Our experience at COREDO shows: we model in advance a jurisdiction risk matrix and a roadmap for obtaining the relevant approvals to avoid regulatory arbitrage with unpredictable consequences.

MiCA passporting for operating in the EU is a powerful advantage: a single standard for 27 countries, centralized requirements for disclosure, token registry, capital and governance. But passporting has limitations: local AML supervision by national authorities, requirements for the language of disclosures, as well as related rules: PSD2 for payments, GDPR for data, AMLD5/6 for reporting. The solution developed by COREDO: «passporting‑plus», a base license + local procedures (for example, language, STR/CTR formats, interaction with the FIU), compiled into a single compliance matrix.

Dubai offers fast access to capital, infrastructure of liquidity providers and technological flexibility. VARA license for exchanges 2026 requires a clear picture of governance, operational resilience, risk management and internal controls. VARA regulation of virtual assets Dubai 2026 emphasizes tech processes: asset segregation, custody models, incident management and public notifications. The COREDO team has implemented a number of «VARA‑readiness» projects, including Travel Rule integration and KYT automation with on-chain monitoring.

Compliance costs (compliance cost) for MiCA and VARA include CapEx (AML implementation/KYC platforms, KYT, SIEM, DLP, smart contract audits, proof of reserves) and OpEx (CCO/MLRO team, transaction monitoring, training, regular audits, regulatory fees). The assessment of ROI from complying with MiCA and VARA for exchanges is built on three metrics: market access (EU passporting, VARA recognition), reduced cost of capital (trust from banks and investors), and accelerated customer onboarding. At COREDO we calculate ROI as savings on risks (fines, downtime, rejected payments) and revenue growth through lawful marketing and partnerships.

Registering a legal entity for an exchange in the EU under MiCA begins with choosing a jurisdiction: taxes, regulator competence, access to talent and banks. Company registration in the EU: choice of jurisdiction and tax aspects run in parallel with the preparation of the CASP dossier: business plan, policies, risk appetite, description of IT architecture, custody, key roles (CEO, CCO, MLRO, CISO), as well as a token registry and classification under MiCA. An important block is client onboarding under MiCA requirements and the disclosure and transparency obligations under MiCA.

Registering a legal entity in the UAE under VARA — a choice between Free Zone (for example, DIFC/DWTC/DMCC, if relevant to the licensing model) and Mainland. Free Zones provide speed and infrastructure; Mainland — access to government procurement and certain types of activities. Crypto exchange licensing procedures in the UAE include compliance with corporate requirements, proof of economic substance, a compliance package and coordination with banking gateways. In practice we set the sequence: corporate structure (SPV, branch, subsidiary) → preliminary coordination with VARA → technological and operational controls → interview with the regulator.

License migration: how to move an exchange to the EU or the UAE — this is a project about three fronts: legal risks, migration of clients and data, and operational continuity. GDPR and personal data protection during KYC require a DPIA, updates to consents and MSAs with providers, as well as planning backups and data recovery. COREDO’s practice confirms: staged migration, a pilot phase, a dual AML/KYC perimeter and a pre-agreed disclosure plan for clients allow you to pass an audit and regulatory inspection without disruptions.

Capitalization and prudential requirements for CASP under MiCA depend on the type of services and include minimum own capital requirements and buffers. Under VARA: the emphasis is on liquidity resilience, coverage of operational risks and reserving mechanisms. We detail stress‑testing models and liquidity management (prudential stress testing), including outflow scenarios, market shocks and custodian failures. Having a register of limits and three lines of defense reduces the likelihood of supervisory claims.

Management of conflicts of interest and governance are a separate focus for both MiCA and VARA. The board of directors, independent directors, a risk committee, and a clear role for the Chief Compliance Officer and MLRO are not a formality. At COREDO we build an authority matrix, a remuneration policy, personal trading rules and an escalation mechanism. For exchanges with an in‑group market maker, separation of duties, market conduct and independent monitoring are critical.

Operational resilience and business continuity (operational resilience) are mandatory topics. BCM (business continuity management), backup sites, RTO/RPO, incident management and disclosure plans – that is what regulators check first. In our projects COREDO uses tabletop exercises, testing of backup payout processes and chain outage scenarios to demonstrate readiness for failures and cyber incidents.

KYC requirements under MiCA and VARA converge: multi-layered KYC, EDD for high-risk and corporate clients, beneficiary verification, confirmation of sources of funds. KYC/EDD standards for corporate clients include analysis of ownership structures, sanctions risks and geographies. We implement a risk‑based approach: different layers of checks depending on risk, periodic reviews and sampling audits.

Integration of the Travel Rule under MiCA and VARA is mandatory for cross‑border transactions. We use the OpenVASP, Sygna and TRP protocols, addressing interoperability with different VASPs and jurisdictions. AML/KYC processes for cross‑border transactions are configured to satisfy both FATF and local requirements without creating unnecessary friction for the client.

FATF recommendations and their impact on MiCA/VARA set the minimum threshold. Implementing AMLD5/6 in the context of MiCA means correct risk segmentation, triggers for STR/CTR and standardized reporting formats. The COREDO team helps organize interaction with law enforcement authorities and regulators, including handling requests and preserving the chain of custody.

Managing sanctions risks and screening, regular updates of PEP/SDN lists, geographic filters and intergovernmental agreements and information exchange. We combine sanctions compliance with graph algorithms and on-chain analytics to detect complex evasion schemes. This approach reduces the likelihood of blocks by banks and payment providers.

MiCA custody requirements emphasize segregation of client funds, daily reconciliations, and mandatory agreements with custodians under MiCA. Contracts record client rights, procedures for access recovery, insurance, and disclosure procedures in case of incidents. For CASP entities holding assets, it is critical to have a clear map of responsibilities and regular reporting to clients.

VARA custody models detail the architecture of hot and cold wallets, multisig, HSMs, and withdrawal procedures. Custody rules — hot wallets vs cold storage in Dubai — assess not only the technology but also operational controls. Crypto-asset insurance and market practice in 2026 require assessment of limits, retroactive coverage, and coordination with the regulator.

The practice of proof of reserves is becoming standard. We use combined methodologies: on-chain verification, independent attestations, and confirmation of liabilities without disclosing personal data. Audit and certification of crypto exchanges in 2026 include independent verification of financial statements, procedures, and IT controls, which strengthens the trust of banks and institutional investors.

Access control and the role of the CISO in a crypto exchange are coming to the forefront. Cyber risks, backups and data recovery, network segmentation, key management, and operational SLAs with wallet providers are a topic to which VARA applies particularly strict standards. At COREDO we conduct a gap analysis of Technology & Information requirements and address it through SIEM, PAM, and regular Red/Blue Team exercises.

MiCA’s disclosure and transparency requirements include a whitepaper for public token offerings, a token register and classification under MiCA, as well as clear risk disclosures. Public transaction registries and the transparency requirement strengthen oversight by investors and regulators. At COREDO we establish a process for updating the whitepaper when tokenomics or functionality change.

MiCA vs VARA stablecoin regulation converges on one point: the priority of resilience and reserve policy. Assessing stablecoin stability and reserve policy involves checking asset quality, reporting frequency and the transparency of guarantees. In the EU additional requirements are imposed on issuers; in Dubai the emphasis is on disclosures and counterparty risk management.

MiCA’s impact on the licensing of token marketplaces concerns placement, listing and delisting rules, as well as consumer protection. Ensuring investors’ rights and consumer protection means clear pricing rules, prevention of manipulation and clear complaint procedures. We integrate market conduct controls and independent oversight of listings.

Technological compliance solutions (KYT, blockchain analytics) are the foundation for AML compliance for crypto exchanges. On‑chain monitoring and KYT tools, anti‑fraud algorithms and machine learning for AML, AML algorithms using graph analytics and tools for monitoring suspicious patterns provide speed and accuracy. We configure risk‑based rules and playbooks for analysts to reduce false positives and accelerate investigations.

Compliance automation and BPM tools save time and maintain quality. Compliance performance metrics (KPIs, KRIs): onboarding time, share of EDD cases, number of STR/CTR, average investigation time. ROI assessment from automating AML processes includes OpEx reduction and fewer regulatory incidents thanks to a controlled process.

Integration of banking gateways and banks’ KYC requirements remain a barrier for crypto exchanges. Integration with payment providers and PSD2 compliance require reliable identification, transaction monitoring and preventive sanctions measures. The COREDO team pre‑agrees compliance packages with banks, reducing time‑to‑yes.

Blockchain interoperability and oracle risk: new sources of operational and market risks. Smart‑contract audits and technical risk management: independent audits, bug bounties and deployment policies. We include these elements in the regulatory dossier to demonstrate mature risk management.

The supervisory practice of ESMA and national authorities in the EU establishes consistent approaches to disclosures and reporting. Regulatory reports and filing frequency depend on the type of services and the scale of the business: operational incidents, transaction volumes, complaints and disciplinary measures. At COREDO we formalize a reporting calendar and responsibilities for each area.

Regulatory sandboxes and VARA pilot projects are a quick way to test innovations under supervision. The right to appeal regulatory decisions exists in both systems, but it is important to properly document the process and maintain an open dialogue. We prepare position letters and arguments in the regulator’s language.

Supervisory sanctions and fines under MiCA and VARA are a reality for companies with immature compliance. We reduce legal risks for crypto exchanges under MiCA and VARA through early gap assessments, staff training and independent reviews. COREDO conducts pre-audit to fix vulnerabilities before a supervisory visit.

Recently the COREDO team completed a CASP licensing project focused on exchange and custody. We built a compliance plan for entering the EU markets: client onboarding under MiCA requirements, token classification, whitepaper procedures, KYT and the Travel Rule. After obtaining the license we enabled passporting in three EEA countries and scaled the business while complying with MiCA requirements without additional licenses.

Another case: an exchange with derivatives on virtual assets under VARA. We deployed risk management and internal VARA controls, including liquidity stress testing, a Company & Risk Rulebook, Technology & Information controls, as well as custody models with cold reserves and insurance. The regulator accepted the PoR model with independent attestation and regular public reports.

A client from Asia moved its operations center to the EU. We designed the migration of clients and data when changing jurisdiction, arranged contracts with custodians, performed a DPIA under GDPR and conducted an audit of IT controls. Result: successful license migration, smooth transfer of liquidity and continuity of trading without downtime.

Counterparty risk management and credit risk require limits on market makers, custodians and stablecoin issuers. We build prudential stress testing taking into account volatility, oracle failure scenarios and network outages. This increases the confidence of banks and institutional partners.

Exit strategies: IPO, M&A and the impact of regulatory requirements determine the structure of reporting and internal control. Audit and independent review of financial statements, mature policies and transparent KPI/KRIs increase the company’s valuation. At COREDO we build a data room with an emphasis on compliance tracks and regulatory history.

The influence of geopolitics and sanctions policy on exchange operations: a factor of strategic planning. We update screening rules, test alternative payment channels and set up inter-jurisdictional information exchange. This approach preserves market access and reduces the likelihood of sudden blocks.