Blockchain technology is rapidly developing in the global economic sector and has enormous potential for international trade. The Emirati government has thoroughly decided to consolidate its status as a global leader and gain the primacy of economic development in innovation and technology by introducing a promising regulation of cryptocurrency activities. The UAE is considered one of the most promising countries in the world for cryptocurrency initiatives
If you want to get a crypto license in the UAE, it is necessary to understand the peculiarities of business regulation in this jurisdiction. We will take a look at all the requirements and key points of cryptocurrency licensing in the UAE
Registration of the Virtual Asset Service Provider under the minimum regulatory requirements
€ 14 000
Initial set up
€ 13 000
Exhaustive set up of company infrastructure for the start of operational activity
€ 17 500
Initial set up
€ 13 000
Full set up of the VASP business with all the necessary infrastructure, connection to KYC providers, local substance and Accounting services
€ 20 500
Initial set up
€ 13 000
a. Preferred company name
b. Passport copies from all shareholders and directors
c. Utility bills from all shareholders and directors
d. CVs of shareholders and directors
e. A business model of the company (brief description 1-2 A4 pages)
a. Determination of suitable license type
b. Submission of application to DMCC
c. Company registration
d. License approval
e. Preparation of corporate documents
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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
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:
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
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.
To work with UAE cryptocurrency, you need not only to get a license but also to comply with all the requirements of the regulator. Consequently, to calculate the final cost, it is necessary to take into account every point.
Approximate figures for the DCMM zone:
|Contribution of share capital||From $14,000|
|Annual office rent||from $1,500|
If you need two licenses, each will be charged separately. In addition, there may be additional costs. License renewal starts from $16,500
To calculate the exact cost of opening a license for a cryptocurrency company - contact our lawyers.
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%.