Lưu trữ cho từ khóa: United Arab Emirates

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UAE exempts cryptocurrency transfers, conversions from value-added tax

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The UAE, particularly through its Dubai and Abu Dhabi financial hubs, continues to introduce initiatives and regulatory frameworks to attract crypto companies and investors.

Consider the latest update: The UAE announced value-added tax (VAT) exemptions for crypto transfers and conversions.

The UAE’s published changes will take effect on Nov. 15.

The Federal Tax Authority (FTA) on Oct. 2, published Cabinet Decision No. (100) of 2024 to update the executive regulation related to VAT.

The updated executive regulation includes more than 30 amendments affecting various industries.

The nation’s Federal Tax Authority, as per the details shared by business consultancy firm PwC, will apply these exemptions to managing investment funds and other crypto-related activities.

Additionally, PwC reports that the exemptions for the transfer and conversion of virtual assets are treated as effective from Jan. 1, 2018.  

Furthermore, the amendments address input tax recovery for crypto companies. PwC explains that in the UAE, crypto is defined as a “representation of value that can be digitally traded or converted and can be used for investment purposes.”

UAE wants to be crypto-friendly

While several countries, including China and India, have been taking a step back when it comes to crypto adoption, the UAE is embracing it.

The country has been actively working to create a favorable environment for blockchain and crypto businesses. Dubai’s Virtual Assets Regulatory Authority is also playing a crucial role in regulating virtual assets in the UAE.

The VAT exemptions for crypto transfers and conversions could attract more crypto businesses to the UAE.

The country’s positive outlook on crypto is also visible from its growth in the market. A recent report from Chainalysis highlighted that the UAE received over $30 billion in crypto between July 2023 and June 2024.

This number has brought the country to the top as MENA’s third-largest crypto economy. Chainalysis also mentioned the rise in the number of venture capital funds and blockchain businesses in the UAE as a factor contributing to the country’s growth.

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Pháp Lý

Ripple secures in-principle approval to expand services in UAE

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Ripple has received in-principle approval from the Dubai Financial Services Authority to enhance its cross-border payment solutions in the Middle East.

Ripple is expanding its international presence by securing in-principle approval from the Dubai Financial Services Authority to broaden its operations from the Dubai International Financial Centre.

With the latest milestone, Ripple said in an Oct. 1 blog announcement it can now launch Ripple Payments Direct service in the United Arab Emirates, facilitating seamless cross-border payments. With DFSA authorization, Ripple plans to extend its enterprise-grade digital asset infrastructure to a “broader customer base in the UAE.”

“With its forward-thinking regulatory approach and clear guidance for innovative businesses seeking to invest and scale, the UAE is positioning itself as a global leader in this new era of financial technology.”

Brad Garlinghouse, Ripple CEO

The approval from the DFSA comes as part of Ripple’s broader strategy to collaborate with regulators globally, integrating blockchain into existing financial frameworks. Besides Dubai, Ripple holds over 55 licenses worldwide, including from Singapore’s Monetary Authority and New York’s Department of Financial Services.

Reece Merrick, managing director for Ripple in the Middle East and Africa, noted that over 20% of Ripple’s global customer base is located in the UAE, expressing enthusiasm for supporting the UAE’s ambition to become a global crypto and fintech hub. However, despite the latest development, (XRP) price has dipped 3.3%, trading at $0.62 as of press time.

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Pháp Lý

Dubai regulators enforce new rule that mandates crypto marketers add risk disclaimer

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United Arab Emirates’s Virtual Assets Regulatory Authority new rule will require crypto firms to add a disclaimer, warning potential customers about the risks that come with investing in digital assets.

According to a Bloomberg report, companies that want to market their digital assets in the UAE must include a disclaimer to their produce that states “virtual assets may lose their value in full or in part, and are subject to extreme volatility,” starting Oct. 1.

In the updated marketing guidelines for virtual assets, companies that provide incentives for virtual assets or related products in the UAE must acquire a compliance confirmation from VARA.

For example, they must be able to prove that the bonus will not be used to “divert or mislead” investors from properly assessing the risks related to the investment product.

VARA Chief Executive Officer Matthew White hopes that “providing clear and actionable guidance” can guarantee virtual asset service providers will be able to build trust and transparency while operating in the UAE.

In recent years, Dubai has become one of the most favorable cities for crypto marketers, thanks to its crypto-friendly tax regulations and large venture capital investment prospects.

A report published by Bitget research revealed that in 2024, an average of 500,000 crypto traders are reside in the Middle East. The number is expected to skyrocket towards 700,000 by the end of the year.

Last month, a landmark Dubai court ruling recognized cryptocurrency as a valid form of payment under employment contracts.

In October 2023, United Arab Emirates launched RAK Digital Assets Oasis, the region’s first economic free zone that accommodates cryptocurrency, web3, blockchain, and artificial intelligence. The zone offers a business-friendly regulatory environment with tax benefits.

As of March 2024, more than 100 entities had received licenses to operate in the RAK DAO, including Indian crypto exchange CoinDCX.

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DeFi

CoinDCX’s Okto becomes first Web3 wallet licensed in UAE’s RAK DAO

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Okto wallet, the self-custodial wallet developed by Indian crypto exchange CoinDCX, has secured a business license from RAK Digital Assets Oasis, a free-trade zone in the United Arab Emirates.

According to a press release shared with crypto.news, the new license positions Okto as the first web3 wallet to have received a license to operate in RAK DAO. With this new license, Okto is expected to gain a strategic advantage in the region.

The Okto wallet was launched in 2023 and has since amassed over one million users. With support for over ten blockchain networks, including Ethereum, Base, BSC, Arbitrum, Solana, and Polygon, users can create new self-custody wallets, import existing ones, or export them to other platforms.

Neeraj Khandelwal, co-founder of CoinDCX, noted that this milestone would “accelerate the adoption of Web3 among the mainstream audience.”

“We are honoured to have received the business license from RAK Digital Assets Oasis. Self-custody is revolutionary as it grants complete ownership of assets to users. Okto has onboarded over a million users in one year.”

Neeraj Khandelwal, co-founder of CoinDCX

This development follows CoinDCX’s expansion in the UAE, which began with its June 2024 acquisition of BitOasis, the first crypto exchange to register with the UAE Financial Intelligence Unit in 2021.

RAK DAO was inaugurated in October 2023 by Ras Al Khaimah’s ruler, Sheikh Saud bin Saqr Al Qasimi. It is the UAE’s first economic free zone focused on crypto, Web3, blockchain, and artificial intelligence. The zone offers a business-friendly regulatory environment with tax benefits.

Since its establishment, RAK DAO has forged partnerships with key players in the blockchain and cryptocurrency space. In July, mining giant Phoenix Group pledged to invest $100 million in Ras Al Khaimah by 2030. Before that, RAK DAO signed a Memorandum of Understanding with stablecoin issuer Tether to promote the adoption of cryptocurrency payments.

By March 2024, over 100 entities had received licenses to operate in the region. 

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Bitcoin

Crypto millionaires population up 95% in one year, survey shows

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The number of crypto millionaires nearly doubled in 2024, reaching 172,300 as spot Bitcoin ETFs and other crypto assets surged.

The global population of crypto millionaires has surged 95% over the past year, driven by the rise of spot Bitcoin exchange-traded funds and other cryptocurrencies, according to a new research report by New World Wealth and Henley & Partners.

The report reveals that 172,300 individuals worldwide now hold more than $1 million in crypto, nearly doubling from 88,200 in 2023. Data shows that during the same period, the number of Bitcoin (BTC) millionaires more than doubled to 85,400.

Crypto millionaires | Source: New World Wealth and Henley & Partners

Crypto wealth has also expanded significantly, with 325 individuals now classified as crypto centimillionaires —those holding $100 million or more in crypto — and 28 crypto billionaires. The report attributes such a rapid surge to the growth of spot Bitcoin ETFs, which have amassed over $50 billion in assets since their January launch, igniting a surge in institutional participation.

Commenting on the data in an interview for CNBC, New World Wealth’s head of research Andrew Amoils pointed out that of the six new crypto billionaires created in 2023, five owe their wealth to Bitcoin, underscoring its “dominant position when it comes to attracting long-term investors who buy large holdings.”

Investors seeking crypto friendly countries

Crypto is reshaping not just wealth but also the demographics of where the rich live and work. Analysts at Henley & Partners note that many newly wealthy crypto individuals are seeking to relocate to tax-friendly and crypto-friendly jurisdictions, saying they have seen a “significant uptick in crypto-wealthy clients seeking alternative residence and citizenship options.

To rank countries based on their tax and regulatory environments, Henley & Partners developed an index, placing Singapore in the top spot due to its “supportive banking system, significant investment, comprehensive regulations such as the Payment Services Act, regulatory sandboxes, and alignment with global standards.”

Following Singapore, Hong Kong ranks second, with the United Arab Emirates and the U.S. also among the top destinations.

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