The growth of digital assets and the rise of the digital economy has made diversifying investments into cryptocurrencies a future trend. The United Arab Emirates is emerging as a hub for crypto-entrepreneurs, with various business zones offering a favourable environment for conducting crypto-related business activities. Investors can obtain a crypto license in free zones such as DMCC and DIFC or via a representative office in mainland Dubai.
Currently, the allowed business activities include managing databases, making self-owned investments in cryptocurrencies, offering crypto consulting services, and conducting data mining. However, it’s important to note that launching an initial coin offering (ICO) or registering a crypto exchange is not allowed unless approved by a competent authority.
The current climate presents an opportune moment for individuals and entities to partake in the burgeoning digital asset sector by establishing a presence in the United Arab Emirates. It is advisable to consult with experienced professionals, such as those at Far Consultant Middle East in order to gain a comprehensive understanding of the legal frameworks and regulatory approvals that must be secured prior to establishing a digital asset business in the UAE.
Conditions to Obtain a Cryptocurrency License in Dubai, United Arab Emirates
In order to launch a cryptocurrency business in the UAE, there are several conditions and requirements that need to be fulfilled. The financial regulator of the Abu Dhabi Global Markets (ADGM), the Financial Services Regulatory Authority (FSRA), has provided comprehensive guidance and regulations on conducting activities related to cryptocurrencies.
According to the FSRA, the following are the requirements for launching a cryptocurrency business in the UAE:
- Incorporation of a company: The first step is to incorporate a company in the UAE, either in the mainland or in one of the free zones.
- Obtainment of a commercial license: To start a cryptocurrency business in the UAE, a commercial license is required. The license must be obtained from the Department of Economic Development (DED).
- Preparation of a detailed business plan: A detailed business plan, which outlines the company’s objectives, services offered, and target market, must be prepared and submitted to the concerned authorities.
- Compliance with AML/CFT regulations: The company must comply with Anti-Money Laundering (AML) and Countering the Financing of Terrorism (CFT) regulations, as per the guidelines of the FSRA.
- Holding of cryptocurrency in a financial free zone: All cryptocurrency holdings of the company must be held in a financial free zone that is approved by the UAE government.
- Provision of passport copies of partners: Copies of the passports of all partners connected to the business must be submitted.
- Maintenance of records of financial transactions: The company must maintain records of all financial transactions, including cryptocurrency transactions.
- Avoidance of fraudulent activities: The company’s cryptocurrency wallet history must be free of any fraudulent activities or transactions.
- The above requirements were specified by the FSRA under the Financial Services and Market Regulations and its supplementary guidance on the regulation of Initial Coin/Token Offerings and Virtual Currencies, issued in 2018.
It is advisable to connect with a legal consultant or a professional service provider to ensure that all requirements are fulfilled and the process of launching a cryptocurrency business in the UAE is carried out smoothly.
How to apply for a cryptocurrency licence in Dubai?
Follow the following steps for getting a crypto licence in Dubai:
- Download and complete the cryptocurrency licence application form from the relevant government agency of the location where you wish to launch your business in Dubai.
- Add the form to your submission along with a list of all of your company’s shareholders.
- Submit all required documentation to the appropriate government agency where your business is being established.
- Pay the application costs to the appropriate government agency in charge of providing you with a cryptocurrency licence.
- If everything is in order with the application form and the company’s official legal documentation, the necessary officials will issue you a bitcoin business licence within a week of receiving your application.
How to Launch a Cryptocurrency Business in Dubai?
The following are the general steps involved in launching a cryptocurrency business in Dubai, as outlined by relevant regulatory authorities:
- Choose the appropriate business structure: Decide on the appropriate legal structure for your business, whether it be a free zone company, a representative office in the mainland, or another type of business structure.
- Prepare the required documents: Gather all the necessary documents, including passport copies of partners involved in the business, a complete business plan, proof of company capital and operating costs, and a record of the company’s cryptocurrency wallet history that shows no fraudulent activity.
- Obtain the commercial license: Apply for the commercial license through the appropriate channels, such as the Dubai Department of Economic Development or the Dubai Multi Commodities Centre (DMCC).
- Register the company: Complete the registration process for the company, including obtaining the company’s trade name and registering for the commercial license.
- Obtain the required approvals: Obtain any additional approvals required for the specific type of cryptocurrency business you are launching, such as a cryptocurrency consultancy or self-proprietary investment in crypto assets.
- Comply with regulatory requirements: Ensure that the business complies with all relevant regulatory requirements, including registering with the Central Bank of the UAE if necessary, and obtaining any necessary licenses or permits.
- Start operations: Once all requirements are met, the cryptocurrency business can begin operations.
It is important to note that regulations and requirements for launching a cryptocurrency business in Dubai may change and it is recommended to consult with relevant regulatory bodies for the most up-to-date information and requirements. The professionals at Farahat and CO. can assist with the process of launching a cryptocurrency business in Dubai and ensure that the business complies with all relevant regulations and requirements.
From where you can obtain a cryptocurrency licence in Dubai?
One should obtain a crypto trading licence in the UAE prior to opening a cryptocurrency business in Dubai. Following free zones are currently offering cryptocurrency licences around the nation:
Dubai Multi-Commodities Centre (DMCC)
The DMCC is very interested towards introducing and incorporating cryptocurrencies. In Dubai, they provide DMCC crypto licence for aspiring entrepreneurs and business owners. To receive their cryptocurrency licence in the Emirates, people travel from all over the world to DMCC.
The DMCC cryptocurrency licence in Dubai permits businesses to carry out commercial operations like offering services related to cryptocurrencies, trading, storing cryptocurrency, management, building software and apps linked to cryptocurrencies, and much more. One can also provide advising and consultation services with the cryptocurrency licence in the city.
A new cryptocurrency centre has been established by DMCC, and the company intends to serve as the hub for all blockchain-related activities in Dubai.
The incorporation of cutting-edge technologies like blockchain and cryptocurrency only strengthened Dubai’s status as the top global leader in technology. A very important role in this accomplishment is played by the DMCC cryptocurrency licence.
Dubai Airport Free Zone Authority (DAFZA)
Dubai Airport Free Zone Authority (DAFZA) is another free DMCC in Dubai that generally supported the addition of cryptocurrencies and it provides DAFZA crypto license.
They entered into a contract with the UAE Securities and Commodities Authority (ESCA) that allowed them to promote new business owners and entrepreneurs who wished to engage in profitable cryptocurrency-related ventures.
Additionally, they can provide services to international investors visiting to Dubai from all around the world.
Due to the DAFZA’s good regulatory framework, businesses within their borders can seamlessly carry out their operations.
They are moving forward with their plan to increase the acceptance and growth of digital currencies like Dogecoin, Bitcoin, Ethereum, and others.
DWTC Crypto Licence
DWTC had already declared that it will be one of the first free zones going to issue crypto relevant licences under oversight of Securities and Commodities Authority. The activities available are:
- Services for distributed ledger technology
- Proprietary trading in crypto-commodities
Abu Dhabi Global Market (ADGM)
Crypto assets that are governed by the Financial Services Regulatory Authority (FSRA) are allowed to operate in the Abu Dhabi Global Market (ADGM). All cryptocurrency-related assets in the Emirates are managed by the FSRA, a regulatory organisation.
It is currently the only legitimate government organisation in the UAE with a comprehensive regulatory framework for cryptocurrency trading license in Dubai.
How can we assist you?
Far Consultant Middle East is listed as one of the top auditing and consulting firm in Dubai, UAE. Our professionals provide services at a reasonable cost so that business owners can conveniently conduct their operations in Dubai and the other emirates.
In addition to licencing facilities, we offer other services that guarantee the seamless daily functioning of our clients’ businesses.
Farahat & co. can assist in establishing the business in Dubai and the UAE, obtaining the company’s business trade licence, obtaining a cryptocurrency licence in Dubai, and providing advice on any legal matters relating to your company.
Our objective is to meet the requirements of our clients.
Feel free to contact us today if you want to know more about the cryptocurrency business in Dubai.