How is the crypto industry regulated in the UAE?
Features of crypto regulation in the United Arab Emirates
The United Arab Emirates is leading in the field of the crypto industry. The state is loyal to this activity and has transparent legislation, so the number of companies wanting to obtain a crypto license in UAE is growing. Every year, the number of investors who wish to invest their capital in virtual currency in the country is increasing, thanks to the precise regulation of the business in this jurisdiction, which ensures legality and reliability.
The country has developed regulations for organizations involved in business activities. Before you start your financial activities related to digital currency, you need to fulfill several conditions:
After the company chooses the direction of activity in digital currency, it sends an application for one of two types of permits.
Types of permits
Before the start of the functioning of the organization, you need to be permitted at a specialized financial center. This organization issues two types of permits, namely:
From this, it follows that in this country, crypto activities are divided into specific areas in the financial field of business, which are prohibited from violating.
The Financial Center and the Securities Authority have entered into a contractual relationship, which provides for developing a regulatory framework for organizations engaged in the business.
An organization planning to conduct activities related to virtual assets must follow specific requirements:
If at least one of the above points is not met, then even with a permit, the company will not be allowed to operate.
Crypto business legislation
Currently, state control includes the following items:
Next, we will consider in more detail based on what legal documents the activities of organizations are regulated.
Government regulators include the SCA and the Central Bank. SCA controls the work of companies based on the “Decision on the control of crypto assets.” The regulatory document includes activities related only to the purchase and sale of virtual currency. The Central Bank controls actions based on the “Regulation on Payment Systems” approved by it, which includes the licensing process, and on the “Regulation on Payment Services,” which refers to making payments using a virtual currency with the characteristics of fiat money.
The FSRA and DFSA organizations carry out financial control based on several existing Regulations – activities with virtual assets, e-securities, and the placement of such investments and securities. In addition, the “Law on the Regulation of virtual assets” was signed in Dubai. This law provides for the creation of the VARA Regulator, which is also responsible for the licensing of firms.
Thus, the legal regulation in the United Arab Emirates has a large set of different types of control over the activities of companies.
By conducting business in this jurisdiction, the company can legally do business, following the approved legal documents and the regulatory authorities, ensuring that all conditions and requirements are met.