CRYPTOCURRENCY SETTLEMENTS IN THE UAE

CRYPTOCURRENCY CALCULATIONS IN UAE

Financial Services Regulator of Abu Dhabi Global Market (FSRA-ADGM) was the first to set rules and regulations for buying and selling cryptocurrency. The guidance concerned the regulation of initial coin offerings (ICOs) and digital currencies that allow the general public to buy and sell cryptocurrency. Actual goods will be determined by FSRA-ADGM on a case-by-case basis. The purpose of the ADGM rules and regulations is to enhance transparency, combat financial terrorism and limit money laundering. DMCC (Dubai Multi Commodity Authority) has given traders the opportunity to create a cryptocurrency trading business inspired by ADGM laws.

Companies, on the other hand, will only be allowed to trade according to their own capabilities. As a result, such companies will be able to build the world’s first deep “cold storage” of cryptocurrency. Under the ADGM regulations, the UAE Central Bank issued a regulatory framework for an electronic payment system in 2017, restricting all digital currencies and transactions and raising concerns in the UAE market. However, the governor of the Central Bank said that the restrictions will not apply to the cryptocurrency after receiving an unsatisfactory recall. Despite this confirmation, the UAE still lacks established regulations to successfully understand cryptocurrency validation or sue for digital currency fraud.

The most important regulatory act recently passed in the UAE is the Securities and Commodities Authority (SCA) Decision No. 23 of 2020 on the regulation of crypto-assets, which comes into effect on November 1, 2020.

Almost all crypto-asset activities are governed by Regulation, which includes the offer, issue, advertising, listing and regulation of exchanges for trading in crypto-assets, including cryptocurrencies and related activities. All of these activities will require SCA approval and appear to be subject to the same rules that apply to traditional securities. The regulation further expands existing restrictions on money laundering and terrorist financing, such as requiring all licensed entities to treat a client’s transaction with cryptoassets as “high risk” due to client due diligence.

According to Article 48 of the Internet Safety Law, any person who advertises, promotes or encourages the trading of a cryptocurrency not legally recognized in the UAE, and does so without a permit, is liable to imprisonment or a fine of between 20,000 and 500 000 dirhams. As well as making any fraudulent scheme illegal under the Criminal Code, committing cryptocurrency scams online could put people at risk of prosecution under the new law. Article 40 provides for imprisonment for a term of not less than 1 year or a fine of 250,000 to 1 million dirhams, and Article 41 provides for a punishment of imprisonment for a term of up to 5 years or a fine of 250,000 to 1 million dirhams.

Taxation of cryptocurrency activities in the UAE

There is no income tax for crypto businesses in the UAE, which makes it interesting for entrepreneurs. If you use cryptocurrencies to trade or earn from them, you will not pay cryptocurrency tax in Dubai. On the other hand, the UAE has an extremely low VAT rate of 5% since the beginning of 2018. You should seek further advice to assess whether your project is exempt from VAT. And, with rare exceptions, there are no taxes on cryptocurrency in the UAE.

Legal assistance in the UAE – Bitcoin and cryptocurrency.

Therefore, the assistance of lawyers on issues of cryptocurrencies, their mining, the registration of IEO, DeFi and other crypto projects is a set of measures aimed at the registration of such relationships in full compliance with the current legislation of the UAE

The most common questions to our lawyers are:

• Payment for services, works, real estate and other assets in the UAE with Bitcoin (BTC) and Ethereum (ETH). Truth or myth?
• Where in the UAE can you exchange Bitcoin, Ethereum, Ripple and other cryptocurrencies?
• How to buy goods for bitcoin in the UAE?

You can get answers to these and other questions by calling our lawyers or by leaving your phone number.

Crypto exchange in the UAE Buying and selling cryptocurrency in the UAE through YK Prykhodko and partners is profitable and safe. Try us at work!

Importantly! We recommend a mechanism for purchasing certain property for “crypto” by concluding a mining contract. The conclusion of a contract for the sale of goods or services, where payment is made in cryptocurrency, may be declared null and void in a court of law, as crypto, as a currency, is not recognized at the legal level of the UAE. For example, crypto currency in Ukraine is not recognized as a means of payment, and due to some regulations and positions of central authorities, it is equated to surrogate money. Our lawyers are well-versed in all trends in the regulation of cryptocurrency in the world, including in the UAE, guaranteeing the most protected ways of its use.