Cryptocurrency companies from countries like India and Singapore are switching headquarters to the UAE. And with this current influx of big crypto companies into the United Arab Emirates, it is only right for anyone to ask this question. Why is this happening now?
However, one would have a better understanding by taking an objective look at this country, its regulations, and policies.
Therefore, this article will serve as a crypto help guide for enthusiasts, and you will find out why cryptocurrency companies are moving to the UAE. Let’s get into it.
Change In Regulations And Policies
Seeing as there has been a change in the cryptocurrency regulations and policies in the United Arab Emirates, it is no wonder that new companies are trooping in. This policy change accounts for their success in digital coins despite other countries recording significant losses in recent years.
In 2019, the government took it upon itself to provide a clear framework for regulating digital assets. And they did this by setting up a body called the Virtual Assets Regulatory Authority, VARA. They also established a new licensing system, ensuring better security and clarity for businesses and investors.
This regulatory clarity is very important as it allows for a stable environment where cryptocurrency companies can operate. It also allows for a sense of trust between investors and customers.
Attractive Environment For Top Crypto Talents
Another feature that makes the UAE a hotspot for crypto companies is its business-friendly environment. The country’s government achieved this by establishing several initiatives which promote innovative ideas and sole enterprises.
One such initiative is the Dubai Blockchain Strategy, as well as the Emirates Blockchain Strategy 2021 introduction. These two initiatives show the government’s interest in implementing digital transformation and blockchain technology to better their economy. And this, in turn, makes the environment more attractive and conducive for crypto traders and businesses.
Furthermore, the government does not impose too much rigidity on companies dealing with digital assets. Rather, such businesses even enjoy tax benefits, business incentives, and effective legal frameworks.
Reputation
Besides cryptocurrencies and digital assets, the UAE is also known as a major global financial planning hub. This reputation of being a top global financial hub thus makes it more appealing to companies, especially in cities like Dubai.
In perspective, the UAE is home to several major banks and financial institutions. And with its wide fintech economy, crypto companies readily have access to banking services, collaboration opportunities, and even sponsorship deals.
In addition, the presence of institutions mainly for supporting the growth of digital companies further contributes to this reputation. And the Dubai International Financial Centre’s (DIFC) Innovation License is one such institution.
Technological Facilities
The United Arab Emirates has lots of technological infrastructure that it can boast about. And this makes it ideal for cryptocurrency companies. These tech facilities are a result of the country’s investment in high-quality internet speed, modern data centers, and state-of-the-art telecom services.
All of this cutting-edge tech makes the UAE the ideal location, as it has the necessary tools for such businesses to thrive.
Furthermore, the potential of blockchain in various other industries like healthcare, government services, and logistics is being employed. This would help facilitate the growth of virtual assets companies, thereby attracting them to the UAE’s efficient ecosystem.
Strategic Location
Location is another reason why this country is recording an increased interest in the influx of digital businesses. Its strategic placement makes it the ideal location for trading.
The United Arab Emirates is located in the midpoint of both East and West. And as such, it acts as an entry point to both local and international financial markets.
With this, crypto businesses in the country will find it easier to access a more robust range of markets. It would also help in establishing better relationships with potential stakeholders. The country’s strategic location thus provides companies with effective connectivity, great infrastructures, and excellent banking services.
Increased Investor Interest
One other reason why more digital asset companies are now flocking into the United Arab Emirates is because of the recent increase in interest by investors. And since there are more people interested in investing (demand), crypto businesses have decided to up the supply as well.
Also, keep in mind that the country’s population is made up of a younger generation who are tech enthusiasts. This means that the adoption of blockchain technology and digital coins was always inevitable. This increasing financial potential has thus led to more companies being attracted to the UAE, which helps cater to both local and national demand.
Final Thoughts
Several factors account for why the United Arab Emirates is an attractive destination for cryptocurrency companies, such as those mentioned above. But regardless of what the reasons may be, we hope to see more evolution and expansion in the country’s cryptocurrency market.
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