Key Highlights:

• The UAE is expected to reach 3.78 million digital currency users by 2025.
• Dubai Multi Commodities Centre (DMCC) oversees cryptocurrency regulations in the UAE.
• The UAE’s cryptocurrency industry grew by 42% annually, with $34 billion in Bitcoin transactions.
• Various crypto licenses available include those from DWTC, DIFC, and DMCC.
• Crypto license costs in Dubai range from AED 7,000 to AED 35,500, depending on the license type.

Cryptocurrencies have gained immense popularity globally, and many investors and businesses are looking for favorable jurisdictions to operate in. For Indian residents interested in venturing into the crypto space, the United Arab Emirates (UAE), particularly Dubai, presents an attractive option. 

If we talk about the digital currency users in the UAE, it is expected to reach 3.78 million by 2025, as mentioned by Khaleejtimes. 

After all, this guide aims to provide a comprehensive guide on how Indian individuals can obtain a crypto license in the UAE, Dubai. 

Understanding the Regulatory Environment

Before diving into the process, it’s crucial to grasp the regulatory landscape in Dubai regarding cryptocurrencies. The UAE, including Dubai, has been proactive in embracing blockchain technology and digital assets. The regulatory authority overseeing these matters is the Dubai Multi Commodities Centre (DMCC).

In terms of blockchain technology and cryptocurrency laws, the UAE has made a name for itself. The main regulatory body in charge of regulating cryptocurrency activity is the Dubai Multi Commodities Centre (DMCC). 

As part of its proactive strategy, the UAE has established a transparent legislative framework that encourages innovation while guaranteeing adherence to global norms.

According to Zawya, “the UAE’s cryptocurrency industry experienced a remarkable 42% annual growth between July 2023 and June 2024, with almost $34 billion in Bitcoin transactions.”

Dubai’s appeal as a crypto hub is demonstrated by the fact that this rise is far higher than the MENA average of 11.73% during the same time period.

Types of Cryptocurrency Licenses Available in Dubai

Various cryptocurrency licenses are available in Dubai, depending on the particular company operations you plan to carry out. Here is an overview of the most common crypto license in Dubai, while the specific kinds may range slightly throughout free zones: 

1. Dubai World Trade Centre (DWTC) License

The main regulatory body for Dubai’s virtual asset sector, VARA, is housed within the DWTC. VARA provides a range of licenses, such as: 

• Full Market Permission: For brokers, custodians, and exchanges.
• Minimal Market Permission: For advisors, wallet providers, and other associated services. 

2. Dubai International Financial Centre (DIFC) License 

The Dubai Financial Services Authority (DFSA), which controls the DIFC, grants licenses for various financial operations, including cryptocurrency-related ones. 

3. Abu Dhabi Global Market (ADGM) License 

The Financial Services Regulatory Authority (FSRA), the regulatory arm of ADGM, has setup a regulatory sandbox for ideas related to cryptocurrencies. 

4. Dubai Multi Commodities Centre (DMCC) License 

One of the leading companies in the crypto licensing market is DMCC. Businesses can apply for regular trading licenses and carry out crypto-related operations within the legal framework established by the Securities and Commodities Authority (SCA), even if DMCC does not have any specific crypto licenses. 

Crypto License pricing in Dubai

Steps to Obtain a Crypto License in Dubai

• Legal Consultation: Seek legal advice from professionals well-versed in cryptocurrency regulations in Dubai. Understand the legal requirements, compliance standards, and any recent updates to ensure a smooth licensing process.
• Business Setup: Establish a legal business entity in Dubai. This involves choosing the right business structure, registering your company, and obtaining the necessary permits.
• Physical Presence: To obtain a crypto license in Dubai, you may need to have a physical presence in Dubai. This can be in the form of an office. Many free zones in Dubai offer a business-friendly environment for startups, including those in the crypto space.
• Compliance Documentation: Prepare and submit all required documentation for compliance. This may include proof of identity, a business plan, financial statements, and details about your cryptocurrency-related activities.
• AML/KYC Compliance: Ensure that your business adheres to Anti-Money Laundering (AML) and Know Your Customer (KYC) regulations. Implement robust procedures to verify the identity of your clients and prevent illicit activities.
• Cybersecurity Measures: Given the sensitive nature of the crypto industry, implementing robust cybersecurity measures is paramount. The regulatory authorities in Dubai are keen on ensuring the security of digital assets.

• Financial Requirements: Meet the financial requirements set by the regulatory authorities. This may include demonstrating the financial viability of your business and having adequate capital reserves.
• Application Submission: Submit your application for the crypto license to the DMCC. The regulatory body will review your application, and upon approval, you will be issued the necessary license to operate in the cryptocurrency space.

The Crypto Market Landscape in the UAE

Because of interest from both institutions and consumers, the UAE has grown to become the third-largest crypto economy in the MENA area. Particularly notable:

• Increases of over 80% were observed in both small retail purchases (less than $1,000) and large retail transactions ($1,000–$10,000).
• A balanced growth across all transaction sizes was indicated by the roughly 55% increase in institutional transactions ($1 million–$10 million).

Furthermore, the UAE market is seeing an increase in the use of decentralized finance (DeFi) systems. Decentralized exchanges (DEXs) alone had an 87% gain in value, while the overall value received by DeFi services climbed by 74%. This diversification shows a developed cryptocurrency ecosystem that draws users from outside of centralized exchanges.

With transaction volumes rising by more than 100% annually, Bitcoin continues to dominate this sector. On the other hand, altcoins and stablecoins both saw notable growth rates of more than 75% and 22%, respectively.

Conclusion

Dubai’s progressive stance on blockchain and cryptocurrencies, coupled with its strategic location and business-friendly environment, makes it an attractive destination for Indian residents seeking to venture into the crypto industry. 

By following the outlined steps and ensuring compliance with regulations, Indian entrepreneurs can get a crypto license in Dubai and pave the way for a successful cryptocurrency venture in the heart of the UAE.

To setup your crypto business in Dubai, UAE, JSB Incorporation is here to help you. Get started today with us.