Welcome to Slate Sundays, CryptoSlate’s new weekly characteristic showcasing in-depth interviews, professional evaluation, and thought-provoking op-eds that transcend the headlines to discover the concepts and voices shaping the way forward for crypto.
One of many principal takeaways from TOKEN2049 earlier this 12 months was that the UAE, and Dubai specifically, is the most well liked spot (fairly actually) on the crypto map. Judging by the spectacular footfall on the convention, which surpassed 15,000 worldwide attendees, it was one of many 12 months’s most extremely attended occasions.
Held in Madinat Jumeirah, one among Dubai’s most iconic settings, the convention venue served up a refreshing mix of an old-world-style winding souk towards the backdrop of a palm-fringed seaside, with the Burj al Arab, the world’s solely 7-star resort, rising like a sail within the distance.
That’s probably the most notable quirks of Dubai: the distinction of the previous and new; the putting dichotomy between progress and custom. Automated e-gates welcome you on the airport, spotless lodges present the final word in consolation and magnificence, and Bedouins have a tendency camels within the timeless desert sands.
Regardless of the punishing 45-degree warmth that had convention dwellers mopping perspiration from their brows, Dubai revealed its unabashed intentions to be a pacesetter within the crypto area, with among the largest names within the trade, together with Solana and Ripple, throwing their hats into the Center Jap ring.
Why are crypto firms flocking to the Center East?
An increasing number of crypto firms are opening workplaces on this vibrant land, and nearly each second individual I interviewed had both established or was eager about establishing a presence right here. What attracts them to this shiny metropolis of shisha, shawarma, and superlatives?
Dr. Marwan Alzarouni, CEO of the Dubai Blockchain Middle, which helps form Dubai’s blockchain ecosystem by way of non-public and public sector collaborations, informed me:
“Over the previous 12 months, we’ve seen the worldwide crypto ecosystem evolve from a speculative wave to a extra utility-driven period. In Dubai particularly, the ecosystem has matured dramatically. There’s been a marked improve in developer exercise, ecosystem occasions, and an inflow of top-tier expertise and founders, a lot of whom now name Dubai dwelling, moderately than simply passing by way of.”
Dubai’s inhabitants grew by over 169,000 to three.825 million in 2024, which was its quickest annual inhabitants improve since 2018. Folks from far and broad have flocked to the UAE for its ease of doing enterprise, secure streets, luxurious lodges, and white sandy seashores. What was as soon as a fishing village on the fringe of a desert has change into a contemporary world of sweeping skyscrapers, world-class resorts, and, extra latterly, crypto founders.
Tax breaks, expertise, strategic location; Dubai has all of it
Because the UAE’s most vibrant metropolis, Dubai gives a spread of tax incentives to assist enterprise progress, innovation, and international funding. Many firms are exempt from company tax, comparable to companies with an annual income beneath 3 million AED (roughly USD 815,000) or these included in a qualifying free zone, such because the Dubai Worldwide Monetary Centre (DIFC) and Dubai Multi Commodities Centre (DMCC). For individuals who do must pay the piper, they’re taxation charges dwarfed by the likes of Europe or the USA, at simply 9%.
Dubai’s strategic location on the crossroads of Europe, Asia, and Africa lends important benefits to companies and buyers, as a pure gateway for tourism and commerce. Dr. Alzarouni explains:
“Corporations are drawn to town not only for its coverage atmosphere, however for its entry to capital, distinctive high quality of life, and a authorities that actually collaborates with the non-public sector.”
Digital asset monetary companies supplier HashKey Group has operations in Hong Kong, Singapore, Japan, and Bermuda, and lately opened an workplace in Dubai, HashKey International MENA. Managing Director Ben El-Baz commented:
“Strategically positioned within the coronary heart of the area that has been characterised by its current transition from oil to tech and culture-driven economies, Dubai has established itself as probably the most essential crypto trade hubs up to now few years.”
Main web3 companies pioneer Animoca Manufacturers introduced the opening of its Dubai department on the convention. I requested co-founder, govt chairman, and general trade legend, Yat Siu, what was behind this determination.
“You could have a vibrant market, and Dubai is as vibrant because it will get! It’s not simply buyers, it’s folks constructing, it’s expertise, and it attracts capital and progress. Now we have dozens and dozens of firms in our portfolio that at the moment are within the UAE, and so they weren’t within the UAE earlier than.”
High DEX aggregator and DeFi options supplier 1inch is one other of crypto’s best to position a digital flag on these unique shores. When requested why, co-founder Sergej Kunz defined that 1inch’s pursuits are “purely technical.” He stated:
“Dubai’s strategic place as a world hub with robust worldwide connectivity, a deep technical expertise pool, and a secure atmosphere has helped it emerge as probably the most dynamic facilities for blockchain innovation. By way of our native software program growth entity, we’re capable of contribute to this momentum.”
Regulatory readability: VARA in Dubai’s digital asset panorama
Dubai’s Securities and Commodities Authority (SCA) establishes authorized tips for the sector, whereas the Digital Belongings Regulatory Authority (VARA), acknowledged because the world’s first unbiased digital belongings regulator, oversees and exams new digital asset actions in a managed atmosphere.
Free zones just like the DIFC and the DMCC present extra operational flexibility. Notably, the DIFC has launched a Digital Belongings Legislation that clearly defines the principles for managing and transferring digital belongings. Dr. Alzarouni commented:
“Dubai is likely one of the few jurisdictions globally that gives a coherent, progressive regulatory atmosphere whereas actively encouraging innovation. We’ve additionally seen a rising variety of exchanges, VASPs, and infrastructure suppliers both relocate their headquarters to Dubai or set up strategic satellite tv for pc workplaces right here. This, mixed with clear regulatory frameworks like VARA’s full rulebooks, has boosted institutional participation and accelerated the adoption of real-world blockchain use instances comparable to tokenized belongings, on-chain finance, and decentralized id.”
Samar Sen, SVP Head of APAC at Talos, a world digital asset expertise supplier for establishments, informed me:
“When there was a time of regulatory uncertainty, a number of corporations flocked to the Center East. I’m more than happy to say that the Center East didn’t simply hand out licenses simply. They put collectively a rigorous due diligence and weeded out a number of corporations that had been scammy or fraudulent, and you’ve got a number of good corporations right here, crypto founders and OGs, main the best way with that pioneering power.”
El-Baz acknowledged:
“Securing the VASP license within the MENA area represents a major milestone in HashKey’s market growth technique. Because the UAE continues to ascertain itself because the premier hub for digital belongings within the Center East, HashKey International MENA will cater to shoppers and enterprises searching for trusted, compliant entry to digital asset companies.”
Kunz added:
“Whereas 1inch itself doesn’t function a regulated enterprise in or out of the UAE in the present day, we see robust potential in Dubai’s regulatory and innovation ecosystem. We additionally proceed to guage the opportunity of taking part in a regulatory pilot with VARA within the close to future. As 1inch develops decentralized finance infrastructure and tooling, having a technical base in a jurisdiction that’s actively shaping regulatory frameworks permits us to remain aligned with rising necessities.”
Authorities initiatives and excessive crypto literacy
In recent times, Dubai and the UAE have hosted a rising roster of high-profile blockchain and crypto occasions, together with Abu Dhabi Finance Week, Bitcoin MENA, and TOKEN2049, every drawing hundreds of trade leaders, buyers, and innovators from across the globe.
These occasions not solely showcase the area’s ambition but additionally foster worldwide collaboration and data change. In an extra signal of institutional adoption, the Dubai authorities has begun accepting choose crypto funds for sure companies, highlighting the emirate’s ongoing dedication to integrating blockchain into public life.
Initiatives such because the Dubai Blockchain Technique intention to make Dubai the world’s first blockchain-powered authorities, driving effectivity, transparency, and digital innovation throughout sectors. Dr. Alzarouni defined:
“Authorities entities are extremely engaged with innovators, serving to fast-track pilots and public-private partnerships. On the Dubai Blockchain Middle, our mission is to teach, advise, and empower. We offer strategic recommendation to each private and non-private sector entities, arrange technical and academic workshops, assist interpret regulatory frameworks, and supply key introductions throughout the ecosystem.”
Siu recounted his typical experiences talking with authorities officers in different jurisdictions, remarking:
“On this area, so many individuals throughout the royal circuit and the whole authorities circuits are already in crypto. They get it, they perceive it, you don’t have to clarify it to them, and it’s a lot simpler to have a dialog round that versus different locations the place you continue to must undergo the ABCs.”
El-Baz added:
“The MENA area has a various profile by way of retail demographics (native populations and expats) and institutional gamers (monetary establishments, non-public firms, and household workplaces). The proactive method taken by VARA, Dubai’s crypto regulator, has fostered a energetic crypto ecosystem atmosphere.”