The United Arab Emirates, and the city of Dubai in particular, is known as one of the best places when it comes to crypto and blockchain adoption and freedom. This is a country that has taken crypto seriously from the very beginning, even creating a special committee to monitor this market. They have been first in many different aspects when it comes to the adoption of cryptocurrencies.
Being the first country to officially release blockchain policy, it should not be surprising that many people are looking at this Emirate. With many different regulatory agencies, long-term plans, relaxed laws, and zero taxes, Dubai has become a blockchain hotspot. To learn more about the road Dubai took for blockchain adoption and the different policies it introduced, continue reading this article as that’s exactly what we will be discussing.
Things to know about Dubai Blockchain Policy
- The UAE was the first country to release official blockchain policies and frameworks, making the city of Dubai a prime candidate for taking things to the next level
- Cryptocurrencies in Dubai are regulated by the central bank and Dubai Financial Service Authority collectively
- In 2018, Dubai set the goal to be making half of the government transactions using blockchain technology and crypto
- The first business to accept Bitcoin as a payment method in the UAE was a pizzeria called Pizza Guys
Dubai Blockchain Policy in details
When talking about blockchain and cryptocurrencies, you would think that most governments would look at this unregulated financial market with skeptical eyes, with the exceptions of El Salvador and the Central African Republic. But among them, there is Dubai and the UAE, which have taken an interest in this growing field and want to incorporate it into their country and the Dubai emirate especially.
First Days of Blockchain
When blockchain and crypto were introduced to the mainstream in 2013-2014, a lot of governments started to crack down on this market, placing huge limitations on this field and not taking it seriously. Saying that Dubai had the same approach would be incorrect, as they did not give it strong support from the start, but they also did not push it aside. The UAE knew that there was a future for blockchain, and because of this, they simply kept an eye on it and watched where it went. When it comes to milestones, Pizza Guys was the first business to accept Bitcoin as a payment method in Dubai, and IGOT was the first Bitcoin exchange created in the UAE, both taking place in 2014.
Step towards Blockchain
The first major step that Dubai and the UAE took toward adopting crypto law in the UAE was in 2017 when they started regulating blockchain, and with that, they made it officially legal to make transactions using Bitcoin and other cryptos through authorized exchanges and these transactions also had to comply with both UAE and international Anti-Money Laundering regulations. This was taken a step further in 2018 when the UAE set up a special committee to monitor the crypto and blockchain market and study their impact on the broader financial world. The resulting findings concluded that blockchain did not threaten the UAE economy, and on the other hand, it was beneficial for economic growth and diversification. With these findings, Dubai crypto laws were introduced and were going to be administered by both the central bank and Dubai Financial Service Authority (DFSA). DFSA then started to regulate different cryptocurrency exchanges such as Binance, Coinbase, Crypto.com, and many others.
It was in 2018 that the UAE took another major step towards crypto adoption by implementing a plan to transition towards blockchain. Their goal was to have half of the government transactions be made using blockchain by 2021. If this was achieved after 3 years is not fully confirmed, but most sources suggest that the UAE came close to achieving its goal.
Dubai Crypto laws today
Nowadays, Dubai can be considered one of the pioneers of blockchain technology. The UAE became the first country that released an official blockchain policy, where they have outlined many different aspects of blockchain, why it is needed, what benefits it brings, and what kind of adoption it will have in their country.
Recently, Dubai established a new regulatory agency called the Dubai Virtual Assets Regulatory Authority with the help of the Dubai Financial Service Authority which aims to turn Dubai into a leading jurisdiction of blockchain technology. This can be seen in many different crypto summits taking place in Dubai, with blockchain enthusiasts from all over the world traveling to this Emirate for crypto freedom.
Dubai Crypto tax laws
Dubai is a tax-free state, meaning that people who reside in Dubai have to pay no taxes on profits, salaries, sales, or any other transactions that would require taxes to be paid in other countries. Wanting to become a blockchain pioneer, Dubai takes cryptocurrencies on the same level as any other financial instruments, meaning that Dubai residents pay zero taxes on profits made from cryptocurrency investments or any other profits made from crypto. The UAE also made it easier for people who are involved in crypto on a business level and not just investments to transition their business to the country. In 2017, the Dubai International Financial Center released guidelines for crypto exchanges and ICOs with the goal of attracting businesses.
Considering the fact that, when purchasing real estate in Dubai worth at least AED 1 million, which is equivalent to around $270,000, buyers receive a residency visa, it is easier than ever to invest in the growing Dubai real estate market and also benefit from Dubai crypto laws by simply investing in it, or operating your own business from there.
Final thoughts on Dubai blockchain laws
When we are talking about countries where cryptocurrencies and blockchain are not looked at with skepticism and on the other hand are looked at as the future of finances, the United Arab Emirates is one of the first countries that comes to mind. This country was one of the first that took blockchain seriously and saw it as a good opportunity to diversify its financial system.
The UAE became the first country to release an official blockchain policy, where they looked at how blockchain is adopted all around the world and compared it to their approach. They have it explained in great detail, and you can read their full policy on the digital Dubai website. This further shows how serious this country is regarding crypto and blockchain.
Dubai is also one of the few countries that have zero tax on crypto. Meaning that it does not matter if you are just an investor or running a whole blockchain business, whatever profits you make are yours to keep with no need to pay taxes. Combine this with the fact that when investing in Dubai real estate you can receive a residency visa, it should not be a bad idea to move your blockchain business here. For that, simply look for a real estate agency that will help you invest in the Dubai real estate market and start your tax-free life today.
Frequently asked questions about Dubai blockchain policy
Cryptocurrencies are fully legal in the UAE and Dubai. Dubai has many different government agencies specially designed for overseeing cryptocurrencies and blockchain. Being the first country to release an official crypto policy, Dubai is one of the friendliest places when it comes to blockchain.
Dubai is a tax-free Emirate, meaning that residents have to pay zero taxes on profits, salaries, or any other financial gains. Being a crypto-friendly Emirate, Dubai looks at cryptocurrencies in the same way as any other traditional financial asset, meaning that you have to pay absolutely no taxes on any profits made from crypto, be it profits from investments or profits from your crypto business.