Starting a crypto business in Dubai is undoubtedly a great idea thanks to the popularity of cryptocurrencies that has grown by leaps and bounds in recent years. Over the past decade, the digital currency has largely disrupted the financial market in a way. Crypto investments have been the core focus of more and more investors, and the reasons for this have been the excellent ROI, the fast and secure transactional systems, and notably the decentralized model. The fact that the global cryptocurrency market will be worth USD 3474.31 by 2030, is a testament to the bright future of this industry. The UAE has welcomed the rise of cryptocurrencies and has implemented regulations aimed at providing clarity and guidance to the industry.
What Exactly is Cryptocurrency?
Cryptocurrency is a form of digital money based on a technology known as Blockchain and can be used for online transactions. The fact that it is not controlled by a bank or a government is a key reason behind its popularity. This means that through cryptocurrencies, you can carry out transfers without the involvement of banks and other financial institutions. Bitcoin, Ethereum, and Solana are some of the common forms of cryptocurrencies in use.
Why Start a Cryptocurrency Business in Dubai?
Scope of a cryptocurrency venture
An increasing number of millionaires around the world are investing in cryptocurrencies, and with Dubai being home to numerous millionaires, starting a crypto business here makes all the more sense.
Government support for fintech
The Government has already adopted ‘The Dubai Blockchain Strategy’ indicating its strong vision to evolve the financial systems with the latest technological advancements. Without a doubt, this underlines the Dubai government’s unwavering support to the Fintech industry.
Immune to inflation
Most currencies decline in value with the rising inflation. However, this is not the case with cryptocurrencies. As an example, Bitcoin imposes caps on the quantity of coins produced. This helps in preserving the value of the currency and hence ensures protection against inflation in the long run. Hence, launching a venture that deals with a currency unaffected by inflation is bound to bring you excellent returns in Dubai.
Fast, secure, and cost-effective transactions
An appealing aspect of cryptocurrencies is the speed and security of the transactional systems. Moreover, funds can be transferred seamlessly from one part of the globe to another, oftentimes at zero costs. All that’s needed is a smartphone to access your cryptocurrency wallet, and this usually requires no verification/authentication checks, ensuring users the much-needed convenience. For a world that craves speed, convenience, and security, cryptocurrencies provide just that, and this gives you another reason to launch a cryptocurrency business in Dubai.
Prerequisites for a Crypto License in Dubai
- You may be required to obtain approval from the Virtual Assets Regulatory Authority (VARA) – the governing authority for all crypto-related business activities in Dubai.
- You must have appropriate measures in place to secure the financial data of your customers.
- You must comply with all the applicable AML laws. These can include elements related to identity verification and background checks of the customers.
- You must set up internal policies and procedures that govern all aspects of your cryptocurrency business activities.
- You may be required to comply with additional requirements from authorities such as the SCA (Securities and Commodities Authority) and the DFSA (Dubai Financial Services Authority).
In addition to the above, you may be required to fulfill certain other requirements. We advise you to get in touch with our business setup consultants for more details about the prerequisites.
Steps to Obtain a Crypto License in Dubai
Here is the process of securing a crypto trade license in a Dubai free zone:
Determine the legal entity
A free zone venture in Dubai can take up legal forms such as a Free Zone Establishment (FZE), Free Zone Limited Liability Company (FZ LLC), or a Branch. Choose the entity that fits your requirements and proceed.
Choose a trade name and cryptocurrency business activity
You can engage in activities such as crypto trading, asset handling, holding, or consultancy. It is necessary to consult with a free zone company formation consultant to verify whether the activities you have chosen are permitted at the free zone where you are looking to set up. Concurrently, also select a trade name.
Select a workspace
If your business requires, you can secure a physical office space from the options available at the free zone. Alternatively, you can opt for a virtual office as well.
Obtain the necessary pre-approvals
A cryptocurrency business in Dubai may require you to acquire specific pre-approvals from government bodies.
File an application for a crypto license
Apply for a trade license in a Dubai free zone by filling out the application form and providing the necessary documents.
How Much Does a Crypto License Cost in Dubai?
The price of a Dubai crypto license is influenced by the activities you have chosen and the jurisdiction where you are looking to form your company. A business setup service provider can assist you with the pricing details.
Hope our insights are sufficient for you to venture into this futuristic industry. If you have decided to proceed with your plan to set up a crypto company in Dubai, you can collaborate with InZone, a business setup service provider specializing in setting up businesses across free zones in Dubai.