What is a Crypto Trading License?
Getting a trade license is an essential step to start a company in Dubai. A cryptocurrency license is a type of business license that allows individuals conduct business activities related to digital currencies. This type of license applies to businesses in the following industries:
- Crypto
- Blockchain
- Web3
Activities Under a Cryptocurrency License
- Transfer and settlement services
- Advisory services
- Management and investment services
- Exchange services
- Custody services
- Lending and borrowing services
- Broker-dealer services
Who Regulates Cryptocurrency in UAE?
Regulatory Body | Function |
Securities and Commodities Authority (SCA) | Federal regulatory body |
Virtual Assets Regulatory Authority (VARA) | Regulatory body for Dubai (excluding DIFC) |
Central Bank of the UAE (CBUAE) | Maintains compliance and regulates payment services |
Financial Services Regulatory Authority (FSRA) | Regulatory body for Abu Dhabi Global Market |
Dubai Financial Services Authority (DFSA) | Regulatory body for Dubai International Financial Center (DIFC) |
Cryptocurrency Licensing Regulations in Dubai
The Virtual Asset Regulatory Authority (VARA) regulates all the crypto-related activities in Dubai. These are some of the main rules every individual applying for a crypto license should know:
- Every entity must have a valid permit from VARA before commencing their operations, regardless of whether they’re operating from a free zone or the mainland.
- Every entity must have technical systems in place to protect customer data and assets. These systems must be in line with international cybersecurity standards.
- Every entity must have systems in place to protect against Anti-Money Laundering (AML) and Combating the Financing of Terrorism (CFT).
- Every entity must comply with VARA audit requirements.
- Every entity must comply with VARA reporting deadlines, maintaining financial data and monitoring transactions as per regulation guidelines.
4 Reasons You Should Get a Blockchain License in UAE
1. The Dirham is Pegged to the Dollar
As the UAE dirham is pegged to the US dollar, making cryptocurrency transactions much easier to track and record. It also boosts the UAE’ reputation in the eyes of aspiring crypto traders who want to move to the country.
2. Business-Friendly Environment
3. No Double Taxation
4. Crypto-Friendly Infrastructure
Who Offers a Crypto License in UAE?
Free Zone | Features |
DIFC |
|
DMCC |
|
DWTC |
|
ADGM |
|
Types of Crypto Licenses
- Cryptocurrency Trading License: You can only buy and sell cryptocurrencies in Dubai with this license.
- Distributed Registry License: This blockchain license lets you offer solutions without directly trading cryptocurrencies.
- VASP License: This is a Virtual Asset Service Provider license that allows you to conduct activities along with crypto trading like providing crypto wallets, token issuance, and offering crypto custody.
Steps to Start a Crypto Business in Dubai
1. Pick a Trade Name
2. Choose a Location
3. Apply for the Cryptocurrency License
The licensing process generally takes a few weeks. To apply for the license, you’ll need documents like:
- Certificate of Incorporation
- Passport copies of owners
- Ultimate Beneficial Owner(s)
- Financial statements
- Business plan
- Organization structure
Just like a commercial license, you can only start the UAE visa process after your license is approved and issued.
4. Open a Bank Account
After you get your license, you should open a bank account for your business. Setting up a business in the UAE requires a bank account with a local banking service provider.
Cost of a Dubai Cryptocurrency License
The cost to get a cryptocurrency license in Dubai varies depending on the free zone or authority you apply with and your business activity. Generally, you can expect to pay between AED 20,000 and AED 50,000.
This fee usually covers the license itself, but you might also have extra costs like office rent, registration fees, and other business-related expenses.
Simplify Your Trade License Application with A&A Associate
A&A Associate’s expert business setup consultants can streamline your company formation process by handling the license application process and can help you open a bank account that suits your business type.
