The Dubai Multi Commodities Centre (DMCC) says the oil-rich Middle East country attracted more than 500 crypto startups and about 3000 registered businesses in 2022.
Representing a 23% jump from 2021, of the 500, 343 were digital asset startups joining DMCC’s “Crypto Center,” the group told Blockworks, which would mean around 150 crypto-related startups were added in 2021.
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Tax breaks, other benefits to startups
The DMCC is the city’s flagship free zone, which gives startups tax breaks and other benefits. It launched a crypto hub in 2021, located in a 68-storey skyscraper in the Jumeirah Lake Towers area of Dubai.
The centre is meant to serve as a co-working and networking space for entrepreneurs in the crypto and blockchain sectors.
While crypto technically falls under the Virtual Assets Regulatory Authority (VARA) purview, the Securities and Commodities Authority (SCA) — a UAE federal agency — is also responsible for some oversight of the digital asset industry.
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“Backed by a strong regional macroeconomic landscape, DMCC has been efficiently accelerating its growth strategy throughout 2022, focusing on supporting its member companies in high-impact sectors such as Web3 and blockchain technologies, commodities and global trade,” said DMCC CEO Ahmed Bin Sulayem.
Several crypto firms began setting up in the UAE last year to take advantage of the region’s ambitions to thrive as a crypto hub.
Dubai’s new crypto law
Only recently, Dubai’s ruler Sheikh Mohammed Bin Rashid revealed a new crypto asset regulation and an independent regulatory authority to govern virtual assets and regulate the cryptocurrency sector.
The Dubai Virtual Asset Regulation Law and the Dubai Virtual Assets Regulatory Authority (VARA) would oversee the growth of the virtual asset business environment, including regulation, governance and licensing.
Under the new regulation, virtual asset-related businesses and Dubai residents would need to register with VARA before engaging in crypto-related activities under the new law, according to a report by Business Today.
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The businesses that fall under the purview of the law include cryptocurrency exchanges, companies facilitating cryptocurrency transfers and the like. There is no clarity on which crypto assets these regulations apply to.
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