Cryptocurrency and the world of Web 3 is undergoing a global boom, as innovators and entrepreneurs are currently racing each other to cash in on this new trend. While it is a global phenomena, there is no place in the world where this trend is more evident than in Dubai. Since the region is marketing and positioning itself as a melting pot for advancements in this space, it has become an attractive place for entrepreneurs to enter this lucrative market. From wholeheartedly embracing decentralized finance (DeFi) to incorporating blockchain technology and the Web 3 revolution as a whole, the opportunities are endless in Dubai.
Despite this, if you don’t know where to start, you might find it a challenge to enter this space. That’s where we come in with this guide which will give you some insights on the key steps and considerations to keep in mind when setting up your crypto or Web 3 startup in Dubai. As you read on, you will understand more about why Dubai is one of the best places in the world to begin your fruitful journey in this space.
Why Dubai for Crypto and Web 3?
In an effort to attract entrepreneurs, the Government of Dubai has adopted the inclusion of blockchain and cryptocurrency in its economy. This, among other efforts, has portrayed to the world that Dubai is progressive and forward thinking, ideally suited for any Crypto or Web 3 startup. Some key steps taken by policy makers include the Dubai Blockchain Strategy which was unveiled in 2016 and then establishment of the Virtual Assets Regulatory Authority (VARA) in 2022. As a result, it can be said that Dubai seeks to lead the brigade in the Web 3 revolution.
In addition, the regulatory environment is stable in Dubai. You can be rest assured that policies will not change overnight like in other places in the world. If you are a crypto or Web 3 startup, Dubai will give you the landscape needed to grow and thrive. See below for some key reasons why you should consider Dubai:
Government policies
Dubai has left no stone unturned when it comes to driving the message across that blockchain and crypto technologies are an important function of its long term development goals as a hub for commerce. Under the Dubai Blockchain Strategy, it has been outlined that Dubai will become the first in the world to incorporate blockchain across government services.
Legislation
Dubai is one of the few places in the world that has passed laws surrounding the ownership of assets in the virtual world. Like the ones that are overseen by VARA, this gives businesses some clear operational guidelines while building trust and transparency in order to attract investors.
Global Markets
One of Dubai’s most attractive features is its location. Right at the crossroads of Europe, Asia, and Africa, it is idyllically positioned for the global entrepreneur of today. As Dubai itself is a melting pot of people from all over the world, you will be able to network and access a plethora of investors, customers, and partners.
Tax Benefits
Dubai is synonymous for being one of the most tax friendly places in the world for business owners. Personal and corporate income tax are at 0%, with only a few business activities being subject to an exception of this rule.
Thriving Startup Landscape
From startups to accelerators and investors, Dubai has it all within its technology ecosystem. All of these essential components come together to create an atmosphere that is ever ready to bring new projects to life. From simple coworking spaces to venture capital funding, you can find it all in Dubai.
The Five Step Process to Make your Mark
1- Understand the Regulations
When it comes to the regulatory framework surrounding crypto or Web 3 startups in Dubai, this lies in the hands of the Virtual Assets Regulatory Authority (VARA). They play the important role of licensing and regulating any business involved in the crypto pace. They make sure that all crypto platforms, DeFi projects, and other blockchain companies operate in a legal and transparent manner.
When you register your business with VARA, you will be given the option to choose different types of licenses. Be sure to choose one that aligns closest to your business operations:
2- Crypto Trading Platforms
If you seek to create a platform that enables the trading or exchange of cryptocurrencies, choose this option.
3- DeFi Projects
If you are a decentralized finance startup up, this license is for you. However, do take note that the regulations that you would need to follow can vary depending on whether you offer decentralized lending, staking, or other services.
NFTs and Digital Assets
When it comes to non-fungible tokens (NFTs) and other digital assets, choose this option. This will also come with its own set of unique regulatory requirements.
1- Choose the Right Business Setup
Now that you’ve understood the regulatory framework, you must set up your business. Dubai has several options for crypto and Web 3 startups, as each business will have its own set of needs.
If you would like to set up your business within a freezone, Dubai Multi Commodities Centre (DMCC) and Dubai International Financial Centre (DIFC) are recommended as they are very supportive of ventures in this space. As a free zone entity you will enjoy 100% foreign ownership, no personal income tax, no currency restrictions and so much more.
If you would like to work with the local market as well, Dubai mainland business setup can be a fruitful potion for you. Being positioned within mainland Dubai will keep you in close proximity to the local economy and a potential local client base. However, in order to do this, you will need a local sponsor who will own 51% of your company.
2- Build Your Team and Network
Once your company has been set up, you need to focus on building your team. Without a strong and experienced team, it will be rather difficult to keep up with the fast-paced Web 3 and crypto space. You can be rest assured that Dubai has a massive talent pool of developers, blockchain experts, and tech-savvy professionals who are ready to jump on the Web 3 bandwagon.
It is helpful to know that several conferences and networking opportunities on the subject of blockchain and cryptocurrency are held in Dubai. Don’t miss out on these events as they are a great place to meet potential co-founders, employees, or investors.
3- Secure Funding for Your Startup
Securing the required funding for your startup is another aspect that should not be overlooked. Dubai has many investment opportunities that will work well with crypto and Web 3 businesses. A range of investors are present in Dubai and they will be able to equip you with seed capital or Series A funding. Several venture capital firms and angel investors have been known to support innovative blockchain projects.
4- Market and Scale Your Startup
Don’t forget that your startup must reach a global audience. While this is easier to achieve in Dubai thanks to its location and connections with the rest of the world, you would still have to do some work to market and scale your business.
Ideally, you would want to look into the following methods:
- Content Marketing
- Community Building
- Partnerships
Once you’ve established a firm foot in Dubai, the rest of the Middle East will be at arms length for your business. Make sure that you use your position in Dubai as a launchpad for all the Gulf States around you!
In Conclusion,
If you are about to build your crypto or Web 3 startup in Dubai, an exciting opportunity is before you! If you plan your growth carefully and execute your plan well enough, you will be well on your way towards building a thriving Crypto or Web 3 startup. As you progress, make sure that you understand the regulations, secure your funds and build a strong and loyal team. Being in Dubai, you will enjoy the benefits of a support system, global markets at your feet and a talent pool that is eager to work with you. The time is now to get your Crypto or Web 3 startup up and running in Dubai!
How Can SetHub Help?
As the boom in crypto and Web 3 startups took place, we at SetHub also saw a boom in the amount of crypto and Web 3 startups that came to us for help. As one of the leading business setup consultants in Dubai, we’ve helped many entrepreneurs like yourself in getting their crypto and Web 3 startup up and running. We are well versed in all the intricacies of business setup in Dubai and can serve as the ideal catalyst for your growth in the region. Schedule a call with us now and hear back within one business hour! Our promise is that you will receive tailored and relevant advice to get you up and running in no time at all.
