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.