Cryptocurrency license in dubai UAE
The business community keeps on evolving, and therefore more and more investors, entrepreneurs, and pioneers are seeking varied methods to develop their money. In an attempt to do so, the Cryptocurrency sector is growing in popularity throughout the world. In the near future, the new digital money is likely to become more widespread in commercial activities.
With such a rise in digital currency, the UAE is eager to absorb new technological breakthroughs, and cryptocurrency is no exception. UAE is now adapting to the new technology and is now offering cryptocurrency licenses. The UAE government is issuing Cryptocurrency License to assist entrepreneurs eager to dive into cryptocurrency and to aid the country’s growth.
So, if you are looking to become a cryptocurrency giant, now is the prime time to do so. QuickBiz will assist you at every step in getting your Cryptocurrency License in Dubai, UAE.
Major Highlights Of UAE’s Cryptocurrency Ecosystem
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The “Blockchain Strategy 2021” was recently announced by the UAE, with the goal of assisting international entrepreneurs in pursuing trade and commerce in this field.
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The Abu Dhabi Global Markets financial authority and the Financial Services Regulatory Authority have become the initial regulatory authorities in the UAE to publish comprehensive instructions and guidelines on cryptocurrency trading.
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In Dubai, the DMCC Crypto Center, which opened in May 2021, is strongly marketing cryptography and blockchain technology.
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Continuous development can be seen in the framework of Abu Dhabi and Dubai free zones in order to encourage more and more investors and entrepreneurs to establish crypto exchanges while laying out norms for ethical trading and consumer protection.
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UAE is making efforts to promote the growth and trade of digital assets. In an attempt to do, The Securities and Commodities Authorities (SCA) and the Dubai World Trade Center (DWTC) authority struck a deal in September 2021 to facilitate the trade of crypto assets.
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Dubai even organized a Crypto Expo to promote and boost the interest in crypto assets in the area.
Regulators and Legislation Relating To Cryptocurrency In UAE
ADGM (Abu Dhabi Global Markets) financial authority and the (FSRA) Financial Services Regulatory Authority are the agencies who regulate cryptocurrency and blockchain initiatives in UAE. These regulators publish cryptocurrency guidelines to keep an eye on business organizations. The main aim of the regulations is to maintain transparency along with combating money laundering as well as terrorism financing tactics.
Dubai Financial Services Authority (DFSA) and Securities and Commodities Authority (SCA) are amongst other authorities that might play an essential role in UAE’s future crypto laws, rules, and regulations.
Requirements For Getting A Cryptocurrency License In Dubai, UAE
To meet regulatory requirements, the UAE government has established specific qualifying conditions or eligibility criteria that need to be met before applying for a cryptocurrency license in the UAE:
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Get a commercial license form from DMCC (Dubai Multi Commodity Center).
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Provide copies of all your business partners’ passports.
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There must be no fraudulent transactions or activity on your crypto wallet record. In short, you should have a clean crypto record.
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A residential proof is required for all the shareholders. (Utility bills or any bill with the address on. It should be less than three months old.)
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All of your cryptocurrency assets must be transferred to the company once your company is established.
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In order to complete the process, you must submit a questionnaire for approval. Quick Biz will provide this.
Procedure For Obtaining The Cryptocurrency License In Dubai, UAE
In comparison to other types of business licenses available in Dubai, acquiring a cryptocurrency license is rather simple.
If the process appears difficult or you have more pressing business concerns, you can always seek assistance from one of our skilled business advisers. They will get the cryptocurrency license on your account.
However, if you want to get an understanding of the license registration process, following is the procedure to get a cryptocurrency license in the UAE:
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Download and complete the cryptocurrency licensing form from the specific authority where you plan to establish your business.
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Attach and submit the completed cryptocurrency licensing form along with the names of the company and all of its shareholders.
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Submit the needed documentation and application fee to the appropriate authority where you will be setting up your business.
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If the respective authority finds the application form and other documentation appropriate and fitting, the cryptocurrency license will be issued to you within a week of approval.
Free Trade Zones Issuing Cryptocurrency License In UAE
At present, there are three free trade zones that are issuing cryptocurrency licenses in UAE:
Dubai Multi-Commodities Centre (DMCC)
For opening a cryptocurrency-related business organization in Dubai, you have to obtain a cryptocurrency license from DMCC. The DMCC cryptocurrency license in Dubai permits you to engage in activities such as storing, trading, and managing cryptocurrencies, developing software relating to cryptocurrencies, and offering other cryptocurrency-related services. You can even provide consultancy and advising services too with this cryptocurrency license.
DMMC even launched a crypto center in May 2021 to serve as the hub for all blockchain-related operations in Dubai. By promoting crypto and blockchain activities, Dubai has strengthened its standing as one of the most technologically advanced cities globally.
Abu Dhabi Global Market (ADGM)
Crypto assets that are regulated by the Financial Services Regulatory Authority (FSRA)are permitted in the Abu Dhabi Global Market (ADGM) Free Zone. It is the governing authority in the UAE for all crypto-related assets.
FRSA, in collaboration with ADGM, has developed guidelines on using UAE’s cryptocurrency license for the progress of businesses all over the country.
Dubai Airport Free Zone Authority (DAFZA)
Dubai Airport Free Zone Authority (DAFZA), similar to DMCC, has agreed to provide cryptocurrency licenses. They struck a deal with the SCA that allowed them to assist entrepreneurs and businesses who wished to engage in crypto-related economic operations. With the cryptocurrency license in Dubai, they made it easier for companies in the area to operate.
Companies that have been granted a cryptocurrency license by the DAFZA are able to conduct business with their crypto assets. In addition, they can assist international investors and carry out crypto-related commercial operations because of DAFZA’s excellent regulatory framework.
Types Of Licenses
On the basis of the nature of the business activities, DMCC is currently issuing two types of crypto licenses:
To which companies this type of license is granted?
Companies who perform proprietary trading in Crypto commodities are granted a Crypto trading license.
Which activities are covered under this license?
The buying and selling of crypto commodities created on distributed ledger technology applications are covered by this DMCC Crypto license.
Which companies are not eligible for a crypto trading license?
Those companies who are involved in the following operations will not be granted a license by DMCC:
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Crypto Exchange.
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Crypto Brokerage Services.
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Financial Services.
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Banking Services.
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Payment storage or processing services.
Approval and Issuance:
On obtaining prior clearance from the free zone management, you can obtain the crypto trading license in DMCC. The DMCC Authority has structured the proprietary trading in Crypto commodities license as a stand-alone license that cannot be used in conjunction with other operations within the same organization. Additionally, there is a requirement of minimum capital of AED 50,000 for issuing this license.
Which business activities are included under Distributed Ledger Technology Services?
This license allows you to perform activities such as offering database management solutions and associated services using distributed ledger technologies like blockchain.
Any organization that engages in these activities is prohibited from:
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Trading in currencies or cryptocurrencies,
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Setting up an exchange,
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Providing financial activity services.
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Brokerage or payment processing.
Approval And Minimum Capital Requirement:
Cryptocurrency investors should make a note that the DMCC's management must first approve the license's issuance. There is also a minimum capital requirement of AED 50,000 to obtain the license.
Metaverse Service Providers License In UAE
Doors to new opportunities are opening every second as the popularity of cryptocurrencies, and non-fungible tokens (NFTs) grows in the UAE.
The United Arab Emirates (UAE) is laying the groundwork for a move to attract businesses looking to prepare for a future dominated by the metaverse.
Metaverse And Its Business Implications
The metaverse is a three-dimensional virtual space that replicates the scientific principles of our real-world while also incorporating the benefits of augmented reality and virtual reality technology to enable rich, immersive experiences between various users as well as among a user and their virtual environment.
The metaverse has enormous business connotations. It would allow distant people, employees, and consumers to have high-touch interactions.
Employees may hold face-to-face meetings without physically being there.
Consumers can explore destinations, test out new products, and even customize their purchases without having to visit a shop.
Furthermore, when you break the laws of physical reality, you open up new commercial prospects.
DMCC Issues Licence For Metaverse Service Providers
DMCC (Dubai Multi Commodities Center) has just announced a Metaverse Service Provider license for individuals involved in the hosting and development of virtual environments, after the debut of their new Crypto Centre in 2021.
It's important to note that this license doesn't allow for crypto asset trading or the creation and issue of exchange-tradable tokens.
You may also start trading NFTs using their NFTs E-Marketplace platform. Its purpose is to make it simpler for counterparties to connect. Trading or promoting crypto assets is prohibited.
How Can QuickBiz Help?
QuickBiz Business Setup Services is a well-known company formation and business setup service provider in Dubai, UAE. As the metaverse has become the focus of attention, an increasing number of UAE entrepreneurs have begun to consider embracing this new technology. However, not everyone is aware of the specifics. This is where we can assist. We have a team of highly qualified professionals that can assist you in understanding and complying with metaverse-related government regulations.
Get in contact with our specialists immediately if you want to adopt metaverse and push your business to new heights.
UAE’s Regulatory Framework For Trading In NFTs
The United Arab Emirates is viewed as a great commercial destination. Now, the Gulf country is on the verge of becoming a global center for the blossoming but contentious sector of cryptocurrencies. Along with this, the UAE also sees a spike in the trading and creation of digital assets known as NFTs (Non-Fungible Tokens).
Abu Dhabi, the capital of the UAE, looks to be on the brink of launching virtual asset trading, having produced a "consultation paper" outlining the criteria for doing so. The initiative is an initial move toward putting digital assets, such as non-fungible tokens (NFTs), under regulatory control.
The paper recognizes the rising relevance of NFTs in the broader digital asset market. Accordingly, the document suggests that businesses with a license from the free zone's financial authority be permitted to facilitate NFT trading and also suggests the following changes in the NFT trading regulations.
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The Financial Services Regulatory Authority (FSRA), the free zone's main regulator, considers NFTs as intellectual property rather than specific assets or financial tools.
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The authority wants NFT marketplaces to be run by multilateral trading facilities (MTFs) and virtual asset custodians (VACs).
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The FSRA has not proposed establishing a formal regulatory framework for NFTs at present, although it is receptive to NFT activities being conducted within ADGM.
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Wherever possible, ADGM enterprises will have to guarantee that NFT transactions adhere to the ADGM's Anti-Money Laundering and Sanctions Rules (AML) Rules.
Recently, the UAE has also passed its first legislation governing cryptocurrencies and digital assets, including NFTs. The nation will create a Dubai Virtual Assets Regulatory Authority (VARA) to regulate virtual assets under the new legislation.
How Can QuickBiz Help?
NFT and related business control is still in their inception. Therefore, it's crucial to consider whether a non-fungible token conforms to appropriate anti-money laundering and financial legislation. Even if NTFs do not grant you any property or monetary rights, following all applicable international and national tokenization rules is critical.
This is where QuickBiz can assist you. Our team of professionals can help you understand and comply with the laws and regulations governing NFTs and virtual assets, as well as provide you with the necessary information to conduct your business.
Advantages of Setting Up A Cryptocurrency Business In Dubai UAE
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100% foreign ownership of a local company is permitted, i.e., there is no need to look for a local partner.
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The taxation system is benign. No corporate income tax can be levied for the next 50 years of operation.
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There is no limit or restriction on transferring a company’s income and capital.
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No restriction on currencies.
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Zero import and re-export taxes.
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Currently, there is no restriction on foreign employees being a part of the company’s operations.
As we have already discussed, there is no corporate income tax in UAE on cryptocurrency projects. However, UAE has had an extremely low Value Added Tax rate of 5% from the beginning of 2018. You should get additional advice to assess whether or not your project is VAT-exempt.
So, although there are some exceptions, cryptocurrency taxes are typically not carried out in the UAE.
With more and more businesses adopting crypto technology and streamlining their business operations, evolving with the changing environment has become necessary for every entrepreneur and organization. But, you may face some difficulty in establishing a cryptocurrency business in Dubai, UAE.
QuickBiz has a thorough understanding of the crypto market, allowing us to quickly satisfy your needs and guide you through the process of getting a cryptocurrency license and establishing a crypto business in Dubai, UAE.
Frequently Asked Questions Relating To Cryptocurrency License In Dubai ( FAQs)
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