The UAE is the world's most popular jurisdiction for legal activities in the cryptosphere. Gofaizen & Sherle provides professional support in obtaining a crypto license in UAE from scratch with turnkey guarantee in less than 3-4 weeks
If you want to get a cryptocurrency license in the UAE, it is necessary to understand the peculiarities of regulation in this jurisdiction.
You can open a cryptocurrency license in the UAE in the following zones: DMCC, IFZA, ADGM, DWTC, and DAFZA. The license's requirements, conditions, and opportunities depend on the selected economic zone. All crypto companies must fulfill general rules: the authorized capital of at least $13.600, providing the certified copies of the founders' documents, making the business plan, compliance with KYC and AML policies, etc.
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After registering the license, you will be able to issue digital currencies, manage your assets, register a cryptocurrency exchange and perform brokerage activities.
Please note that in most of the cases you must register with the Virtual Asset Regulation Authority (VARA) to operate a licensed cryptocurrency company in Dubai. VARA introduced its Virtual Assets and Related Activities Regulations, which came into effect on February 7, 2023. These Regulations apply to all virtual asset service providers.
Favorable tax environment
Corporate income tax, as well as tax on dividends, is 0%. All income of individuals from international activities is not taxed. At the same time, there are no currency restrictions and no tax rate on imports and exports.
Agreements on the absence of double taxation
Companies can significantly reduce their tax burden thanks to the 123 double tax treaties of the UAE with many other jurisdictions.
UAE entrepreneurs can return 100% of profits and capital to their country, which provides investment protection and increases investor confidence.
There are no customs duties in GCC
Doing business in the UAE has the advantage of having no customs duties in the Gulf Council (GCC), which facilitates trade and export. The UAE Government is actively working to create a favorable regulatory environment for business, encouraging investment and job creation.
The state supports Fintech-sphere
According to the blockchain strategy adopted by the UAE until 2021, half of all government transactions will be conducted on blockchain platforms. It demonstrates the government's desire to adapt to new technologies and strengthen the UAE's position as an advanced economy among the world's developed countries.
No minimum investment requirements
The absence of minimum investment requirements makes the UAE attractive for new and small businesses. It allows many entrepreneurs to start their businesses with minimal financial investment and get the opportunity to develop in a promising market with high growth potential.
No requirements for residency and quota of local employees
Absolute foreign ownership of a local enterprise is allowed without the involvement of resident partners. Moreover, the company is not required to have a certain number of local employees, which provides freedom in hiring and firing staff.
Currency is pegged to the US dollar, and English is the business language
In the UAE, the local currency is pegged to the US dollar, which makes it easier to do business and simplifies calculations and bookkeeping. In addition, English is a business language, which has a positive effect on communication.
To get a Dubai crypto license, the following steps are required:
The first step in launching your cryptocurrency business in Dubai is to register a legal entity and choose a business name. It includes pre-registering a legal entity in the region and choosing a unique name for your company.
If you are having difficulty choosing a name and creating a company, the Gofaizen & Sherle team will help you through the process, ensuring that registration requirements and government standards are met.
As part of the cryptocurrency business licensing process, your company must prepare relevant documents: business plan, financial plan, certified documents of the founders, AML/CFT policies, and other documentation as required by the local regulator.
Gofaizen & Sherle's legal team can help you with the preparation of a complete set of documents for a positive license decision.
To obtain a cryptocurrency license in UAE, you must comply with the requirements and procedures established by the Financial Services Regulatory Authority (FSRA), the Dubai Financial Services Authority (DFSA), and the Securities and Commodities Authority (SCA).
Gofaizen & Sherle will provide support in preparing and completing all necessary procedures to apply for a UAE crypto exchange license, working directly with the relevant free zone authority or equivalent municipality if you have chosen another location for registration.
To start a crypto business in the UAE, certain requirements must be met. Here are some of them:
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VARA (Virtual Asset Regulatory Authority) is the regulatory and supervisory body for all cryptocurrency-related businesses in Dubai. All businesses, including representative offices, data mining firms, and consulting companies that deal in cryptocurrency in Dubai are subject to VARA control and regulation. This means that to operate a cryptocurrency business in Dubai, it is necessary to apply to the regulatory authority to obtain the appropriate license and ensure compliance with all legal requirements.
VARA monitors and supervises cryptocurrency businesses, including compliance checks. The body also develops regulatory regulations and guidelines to ensure security, transparency, and compliance with standards in the cryptocurrency industry.
In the context of your cryptocurrency business in Dubai, it is advisable to contact VARA for detailed information on the requirements, licensing procedures, and all necessary documentation. This approach will help you ensure that your activities are legal and legitimate, and will provide you with proper guidance and regulatory support in your cryptocurrency venture in the UAE.
If you are planning to set up a crypto business in DIFC (Dubai International Financial Centre), it is important to note that the company must have more than 5 years of legal presence in the cryptocurrency industry in another country. The Dubai International Financial Center Authority does not require a minimum share capital for companies whose activities are not related to the financial sector. To register a company with DIFC, at least one shareholder and two directors are required, as well as a special license to operate in the Dubai International Financial Center.
However, it is recommended to use a representative office in Dubai for the most efficient registration of such a company. This will facilitate the registration process and ensure regulatory compliance.
To open a data analytics company in Dubai, you need to apply for an IT company trade license to be able to legally provide this type of service. In addition, depending on the type of your business, you may need to obtain an additional permit for the cryptocurrency business.
This way, you will be able to provide specialized data analysis services for the cryptocurrency sector in Dubai. This will allow you to work effectively in the cryptocurrency industry and develop in a competitive environment.
Cryptocurrency exchange registration in the UAE is becoming an affordable and popular option due to the large number of free zones that allow businesses to trade and store cryptocurrency, process crypto assets, and engage in related activities. Any type of cryptocurrency is available for trading on crypto exchanges in Dubai.
The UAE's 2021 blockchain strategy calls for 50 percent of all government transactions to be hosted on blockchain platforms. This confirms the government's intention to emphasize adaptation to future technologies and cement the UAE's status as the most advanced economy among the world's developed nations
The world's largest exchanges like Binance will soon establish a presence in Dubai. Eventually, it will be the first global cryptocurrency exchange in the UAE. It is becoming clear that the Emirates will become one of the largest cryptocurrency exchanges serving the entire region
The current government provides for regulated and unregulated activities of crypto companies
The license requirements, conditions, and possibilities depend on the chosen economic zone. After registering a license, you will be able to issue digital currencies, make exchanges, manage your assets, register a cryptocurrency exchange, and conduct brokerage activities
You can get a crypto license in UAE in the following zones: DMCC, DAFZA, ADGM, DWTC, IFZA
Let's take a closer look at opening each type of crypto company in the UAE
DMCC (Dubai Multi Commodities Center) is a free economic zone and one of the most popular cryptocurrency businesses in the UAE. Getting a cryptocurrency license in Dubai is available at DMCC and guarantees the legality of your business. The first company to open this license and provide cold storage services for cryptocurrencies is Regal Assets
To register a crypto-exchange, it is necessary to register a company with the Dubai Multi Commodities Center. With this license, it is possible to carry out various cryptocurrency services for customers: management, storage, trading, software applications, crypto exchange, and other services. In the long run, this license will become the main category for businesses
Two types of licenses are available to entrepreneurs at DMCC:
In 2018, the International Free Zone Authority (IFZA) was added to the Emirates' free zones list. It is located in the center of the emirate of Fujairah, in the eastern part of the UAE, the most distant emirate from Dubai. In this zone, entrepreneurs can register enterprises, branches, and subsidiaries. At first, licenses were issued only for trade, services, and industry, but after the conclusion of an agreement with the Dubai Silicon Oasis Authority, the possibilities expanded.
The IFZA, similar to Dubai's DMCC, now supports entrepreneurs doing business in the cryptocurrency space. They agreed with the SCA to issue cryptocurrency licenses in Dubai.
Companies holding an IFZA crypto license can conduct commercial activities using their crypto assets and cryptocurrency transactions, such as exchange and storage. To obtain a crypto license, you must meet specific requirements and complete the registration procedure by the rules and regulations of the IFZA zone.
IFZA also actively cooperates with other free zones in Dubai and worldwide, creating a favorable ecosystem for developing cryptocurrency businesses. It helps entrepreneurs move quickly between zones and take advantage of the opportunities available in each zone to maximize their business potential.
DAFZA is the Dubai Airport Free Zone Authority. To support trading related to the commercial activities of cryptocurrency assets, DAFZA and SCA (Dubai Securities Authority) have signed an agreement. According to this, businesses are allowed to trade cryptocurrencies and provide services to customers
DAFZA intends to integrate the issuance of cryptocurrency licenses with the rest of the global services for investors. Flexible legislative support and regulatory framework from DAFZA are provided for the smooth functioning of business operations. The development of cryptocurrency companies in the UAE is aimed at stimulating the growth of trade and the entire sector in the region
There is currently 1 type of cryptologic license available for own cryptocurrency trading. This license is regulated by the SCA, and under its control are offerings, issuance, asset trading, and related financial activities
ADGM (Abu Dhabi Global Markets) is an Abu Dhabi financial-free zone that is supervised by regulators. They established rules for cryptocurrency activities back in 2018. ADGM aims to connect the Emirates to the cross-national markets of the Middle East, South and East Asia, and Africa to diversify the UAE economy
It is the first jurisdiction in the world that has created a comprehensive regulatory framework for cryptocurrency transactions. The comprehensive framework makes it easier for the leading players in this industry to operate in a business-friendly environment. It covers the full range of different risks associated with financial crime, financial laundering, customer protection, cryptocurrency exchange, and storage operations, and technology management
Obtaining a license in the ADGM zone allows you to cover the full range of activities that are associated with crypto assets: a license for a cryptocurrency exchange in the UAE; storage of cryptocurrency; buying and selling; management of crypto assets of third parties; marketing of cryptocurrency
DWTC (Dubai World Trade Center) is a free zone established in 2015, which is designed to operate and serve innovative industries in the field of virtual assets, cryptocurrency, blockchain, etc
This zone is closely cooperating and also coordinating with VARA (Virtual Asset Regulatory Authority) to approve the status of the newly designated zone for regulated crypto companies. All actions and approval processes for cryptocurrencies are coordinated with VARA
In addition, one of the largest cryptocurrency exchanges, Binance signed an exclusive memorandum of cooperation with DWTC, which will help make the zone a cryptocurrency hub for the region
DWTC reports that it will be one of the first zones to allow crypto licensing in the UAE under the supervision of the Securities and Commodities Authority
Options for legal activities in this area:
VASP has the authority to manage and safeguard cryptocurrency depository wallets belonging to clients, and store and provide clients with information services on balances, and incoming and outgoing transactions. Clients may request up-to-date information regarding their accounts.
Please note that this information may be requested by regulators under KYC guidelines. Therefore, it is important to maintain ongoing analysis and reporting.
Get significant advantages when registering a crypto-business in UAE compared to crypto licenses in other jurisdictions, thanks to the loyalty of the Emirati government, investor support, and the rapid development of UAE cryptocurrency. You can protect your privacy and get enhanced security from blockchain technology in Dubai
The main regulatory body that implements all the regulations and rules for cryptocurrency business in the UAE is the SCA (Securities and Commodities Authority). Their regulations apply to many forms of cryptocurrency-related activities
Payment tokens (stable coins) and stored value funds are regulated by the UAE Central Bank
Crypto Licenses from DAFZA are also regulated by the SCA. It oversees the offerings, issuance, and trading of crypto-assets
The ADGM Free Zone has its own Cryptocurrency Operations Manual, but it was drafted according to SCA regulations. In addition, the FSRA (Financial Services Regulatory Authority) directly regulates ADGM and requires them to follow their own set of rules and guidelines
In addition, the Authority monitors businesses that provide services related to cryptocurrency and blockchain to ensure the prevention of money laundering and other illegal activities. This is currently the only guidance for cryptocurrency operations in the UAE at ADGM
The UAE government recognizes all the risks that are associated with crypto-assets:
Every crypto business is required to develop corporate and customer-oriented rules based on:
Principles that should be framed in the management of every enterprise:
If you want to stay within the right field, you have to follow these standards.
The UAE is a very attractive country for cryptocurrency businesses on the tax side: the federal income and corporate tax rates are 0%. This applies to companies that use cryptocurrency solely for trading or receive it as a salary.
But we should pay attention to the value-added tax. Since the beginning of 2018, the government introduced new rules but put a low tax rate of 5%. Your company can be set up on a zero-tax basis, but ordinary transactions will be subject to VAT at 5%
If you want to find out if your activity is tax-exempt, Gofaizen-Sherle can consult you on this issue
You can get a cryptocurrency license in the UAE from the regulatory authorities of the country where you plan to set up a company. It is also possible to get your crypto license in Dubai. To do this, contact Gofaizen-Sherle for assistance, our team will provide advice and help in setting up the company.
If you want to conduct legal and transparent activities related to cryptocurrency, you need to get a license.
If you use cryptocurrency for trading or receive it as a salary, the federal income, and the corporate tax rate is 0%. Value Added Tax (VAT) is 5%.