DIFC Crypto License

SET UP A CRYPTO BUSINESS IN THE DUBAI INTERNATIONAL FINANCIAL CENTRE (DIFC)

Set up a Crypto Business in the Dubai International Financial Centre (DIFC)

The Dubai International Financial Centre (DIFC) is among Dubai, UAE’s leading free zones. It provides commercial entities with a wide range of services and facilities to help ease their business proceedings in the UAE. DIFC also offers license services to crypto companies. In its position as a leading free zone, DIFC also has its own regulatory framework, separate from the UAE’s government regulations. This is why DIFC is gaining increasing popularity among fintech and digital finance companies. For companies to operate their cryptocurrency business in DIFC, they will need to obtain a license from the DIFC Authority. Also, the Dubai Financial Services Authority (DFSA) is the regulator for DIFC. It is the governing authority that establishes the licensing framework for virtual asset service providers as well as outlining the requirements for obtaining a license to operate their business in the Dubai International Financial Centre. The DFSA also ensures the veracity and safety of the virtual asset activities while providing an additional layer of transparency and certainty to market participants. However, the licensing framework only establishes the standards for virtual asset service providers but does not directly regulate crypto activities themselves.

Dubai International Financial Centre

(DIFC): Crypto Token Regime

The Crypto Token Regime is part of the DFSA’s regulatory regime for virtual assets. It belongs to the second phase of the regime which was introduced in 2021 along with the Investment Token Regime. With the emergence of crypto tokens in Dubai, the scope for financial services has increased. Digital financial services now include dealing, advising, arranging, trading and custody, for application in services and products provided concerning crypto tokens. This new regime states that financial services and activities can be conducted only with recognised crypto tokens. As per an initial list shared by the DFSA, bitcoin, Ethereum, and Litecoin are now recognised crypto tokens in the UAE.

DIFC Crypto License: Types & Categories of Activities

There are several categories and types of licenses that cryptocurrency businesses qualifyfor.Thesecanincludelicensesforoperatingvirtualassetexchanges,operatinga virtual asset wallet provider, and even providing virtual asset custody services. BusinessesthathavetiedupwithDIFCmustfollowitsregulatoryframeworkincludingits stringentAMLandKYCprocesses.

TheDubaiInternationalFinancialCentreoffersthesecryptobusinessesactivities:

DIFC Crypto License: What to Expect?

Crypto companies applying to start a crypto business in DIFC should be compliant with the Crypto Token Regime laid out by the DFSA. New entrepreneurs will be applicable to follow the regime since its introduction from November 1, 2022. However, for already existing license holders, i.e., those who provide crypto token related services, they get a 6-month window of transition to submit their crypto token recognition applications for assessment by the DFSA.

The United Arab Emirates is well on its way to becoming a global leader for digital and virtual assets. And the Crypto Token Regime is among the latest evolutions made in the UAE to cement its position as the nexus for the next Industrial Revolution. Crypto companies that want to make UAE their base of operations can seek out the services of trusted corporate consultancies like Shuraa Business Setup to get the correct guidance for their business.

Our corporate consultants will help you decide which will be the best jurisdiction for your business model as well as depending on the activities you wish to conduct.

List of Virtual Asset Service Provider

Activities that the Crypto Token Regime covers:

Dealing as either principal or agent for recognised virtual assets

Managing clients’ virtual assets

Dealing in virtual asset investments

Virtual assets trading/providing trading platforms and exchanges

Marketing virtual assets

Custody provisions for virtual assets

Sales advisory for buying & selling if virtual assets

Benefits of acquiring a DIFC Crypto License

ThereareseveraladvantagestostartingaCryptocompanyinDIFC–

Legal&RegulatoryFramework

Thecurrentlegalframeworksupportscross-borderactivities

Get100%businessownershipasanexpat

Unlimitedhiringofforeignemployees

100%repatriationofcapital

TaxBenefits

Employeeincome–ZeroTax

Profits,capitalorassetsfrom2004–Zerotaxfor50years

CounterpartyConfidence

DIFCishighlyregardedasanindependentregulator

Partofanindependent,English-speakingcommonlawjudicialsystem

Riskbasedregulatoryapproach

DiverseEcosystem

Accesstocentralregionaldealmaking

Concentratedaccesstointernationalfirms,investmentfunds,banks,wealthmanagementfirms,andavariety offinancialinstitutions

Globallyrenownedregional/internationallawandauditingfirms

Largestfunddomicileintheregion

GeographicEpicentre

DIFCprovidesanopportunityformanagementoffices,holding companies, and offices to be closely located to theassetstheyown/manage

DubaiisthecommercialcapitaloftheMiddleEast,NorthAfrica,(MENA)andSouthAsia

Haswealthofresourcestoreapthepotentialofinternationallydevelopingmarkets

How much will a DIFC Crypto License Cost?

Businesses and start-ups that wish to start their business in the Dubai International Financial Centre can come to Shuraa for a customised quote. However, it is important to note that you will need to pay additional costs depending on the nature of the business activities as well as for any regulatory approvals

Get your DIFC Crypto License today

Dubai is home to several free zones that offer worldclass industry specific services. It can be tough sometimes for new business owners and investors to navigate the complicated legal water of a foreign country. Therefore, the best option is to utilise the services of reliable company formation experts like Shuraa Business Setup. Grab hold of the experience that 22 years in the Dubai industry brings and explore a world of benefits. Get free VAT and tax consultations, corporate banking setup, PRO and visa services to usher your crypto company to the next century.