Crypto in the UAE: Regulation, Licensing & What’s Next (2025)

30 April 2025

Gandhi AlMinaj

With 27.7% of its population owning virtual assets and 15 million crypto-app installs in 2024 alone, the UAE leads the world in per-capita crypto adoption.

Dubai: Unlike markets driven by inflation-hedge motives, the Emirates’ boom stems from a crystal-clear, pro-innovation regulatory regime and deep institutional backing. This guide unpacks the evolving landscape—covering regulators, AML/KYC obligations, step-by-step licensing procedures and what lies ahead.

1. MULTI-JURISDICTIONAL REGULATORS: WHO’S IN CHARGE?

Crypto oversight in the UAE is both federal and emirate-specific. Your licensing path depends on where you set up and what services you offer:

• CBUAE & SCA (Federal) – The Central Bank issues AML guidelines for Virtual Asset Service Providers (VASPs). – The Securities & Commodities Authority licenses mainland exchanges, brokers, custodians, token-issuers and crypto funds under Cabinet Decision 111/2022.

• DIFC-DFSA (Dubai) – The Dubai Financial Services Authority governs crypto in the DIFC. Firms dealing in DFSA-Recognised Crypto Tokens must satisfy capital, cyber-governance and financial-crime controls.

• ADGM-FSRA (Abu Dhabi) – Abu Dhabi’s free-zone regulator oversees exchanges, custodians, derivatives, ICOs and DeFi-style services under its bespoke Virtual Assets Regime.

• VARA (Dubai Mainland & Free Zones) – Dubai’s Virtual Assets Regulatory Authority licenses exchanges, wallets, broker-dealers, lending platforms, market-makers, staking services and NFT issuers under its comprehensive rulebooks.

• DMCC & RAK DAO – Crypto licenses are also available in these free zones—but SCA oversight still applies to mainland activities.

2. CORE AML/KYC REQUIREMENTS

All VASPs must implement UAE-standard anti-money-laundering and counter-terrorist-financing procedures:

·       Customer Due Diligence (CDD): Identity verification, risk profiling and ongoing monitoring.

·       Transaction Monitoring: Automated systems to flag suspicious patterns.

·       Reporting: File Suspicious Transaction Reports (STRs) with the FTA’s Financial Intelligence Unit.

·       Record-Keeping: Retain customer files and transaction logs for at least five years.

3. LICENSING CATEGORIES & TERRITORIAL SCOPE

4. STEP-BY-STEP LICENSING ROADMAP

Define Your Services Pinpoint whether you’re opening an exchange, issuing tokens, offering custodial wallets, lending or running a staking platform.

Select Your Jurisdiction Balance business needs—mainland (SCA/VARA) vs. free zones (DFSA/FSRA/DMCC/RAK DAO)—against capital requirements, onshore access and tax incentives.

ü  Prepare Documentation

• Business plan and governance framework

• AML/CFT policies, risk-management and cybersecurity controls

• Biographies of shareholders, directors and key managers

ü  Meet Capital & Fit-and-Proper Tests Provide proof of minimum paid-up capital, operating reserves and clean backgrounds for all stakeholders.

ü  Submit Application File online via the regulator’s portal, pay fees and pass due-diligence checks.

·       Regulator Review

Expect 3–6 months for an in-depth evaluation of your business model, tech architecture and compliance regime.

License Issuance & Ongoing Compliance Upon approval, launch your services and maintain:

ü  Quarterly financial-crime reports

ü  Annual audited financials

ü  Continuous technology-governance attestations

5. What’s Next: Emerging Developments in 2025

·       Stablecoin Framework: Expect central bank guidance on fiat-pegged tokens and reserve disclosures.

·       DeFi & DLT Sandbox: Expanded regulatory sandboxes for peer-to-peer lending, tokenized assets and decentralized exchanges.

·       CBDC Pilots: Preparations for the UAE’s prospective Dirham digital currency to enhance cross-border payments.

·       Inter-Regulator Coordination: Harmonized rulebooks between SCA, VARA, DFSA and FSRA to simplify multi-jurisdictional operations.

Conclusion

With one of the world’s clearest crypto-regulatory mosaics, the UAE offers businesses and innovators a secure, scalable platform for virtual-asset ventures. By choosing the right regulator, embedding robust AML/KYC safeguards and following our seven-step licensing roadmap, you’ll be poised to capitalize on the next wave of digital-asset innovation.

ALKETBI TOUCH

Ready to launch your crypto venture in the Emirates? Contact our Fintech & Virtual Assets team for tailored legal strategies, application support and ongoing compliance solutions.