Crypto
Use of Cryptocurrency in the UAE
The UAE is one of the most promising jurisdictions for running a crypto business. The Emirates actively attract companies operating in the cryptocurrency sector.
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Overview
Let’s look at how cryptocurrency use is regulated in different jurisdictions of the UAE. We will examine the specifics of crypto industry regulation at the federal level and at the level of the Emirates of Dubai and Abu Dhabi.
Federal Regulation
At the federal level, there are laws regulating the work with virtual assets across all Emirates.
Laws
- The SCA Virtual Asset Regulation
- Stored Value Facilities Regulation
- Retail Payment Services and Card Schemes Regulation
Regulators
- Securities and Commodities Authority
- Central Bank of the UAE
They regulate
- the use of cryptocurrencies, stablecoins, tokens related to securities and commodities,
- requirements for ICOs, issuance, and trading of crypto assets.
Dubai
In Dubai, there is general regulation that applies to the Mainland and all free zones, except DIFC.
Law
- Dubai Law No. 4 of 2022 Concerning Regulation of Virtual Assets
Regulator
- Dubai Virtual Assets Regulatory Authority (VARA)
General Dubai legislation regulates
- issuance of virtual assets and NFTs,
- licensing of asset providers and crypto platforms.
Without a VARA license, the law prohibits
- providing services for managing crypto platforms,
- exchanging one cryptocurrency for another,
- exchanging cryptocurrencies for national or foreign currencies,
- custody and control of cryptocurrencies, etc.
Dubai also has a special financial free zone – Dubai International Financial Centre (DIFC), which is regulated by a separate government body – Dubai Financial Services Authority (DFSA).
Since November 1, 2022, Consultation Paper No. 143 has been in effect, which contains comprehensive regulation of crypto assets within DIFC. In particular, conducting crypto business in DIFC requires a separate license.
Abu Dhabi
In Abu Dhabi, there is the free zone Abu Dhabi Global Markets (ADGM). Regulation of cryptocurrencies in ADGM was introduced as early as 2018.
“The legislation of this free zone made it one of the first places in the UAE to introduce comprehensive regulation of virtual assets and to address licensing matters.” Artur Faniev Commercial Director
Laws
- The Financial Services and Markets Regulations
Guidelines
- Guidance on Regulation of Digital Securities Activities in ADGM
- Guidance on Regulation of Digital Security Offerings and Virtual Assets under the FSMR
- Guidance on Regulation of Virtual Asset Activities in ADGM
Regulator
- Financial Services Regulatory Authority (FSRA)
A complete roadmap for launching and running a business in the UAE — in our guide 'How to Do Business in the UAE?'
In the guide, you will find not only basic information but also expert recommendations based on real cases and deep jurisdictional knowledge:
- How to register a Mainland company
- Types of business licenses in the UAE
- What to do in the UAE after registering your company
- When a bank account in the UAE can be closed
- How to use cryptocurrency in the UAE
- All about UAE corporate tax and IP-Box incentives
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