Dubai, a wealthy city in the United Arab Emirates (UAE), might be one of the best places for crypto aficionados looking to live primarily, and perhaps solely, on digital currencies, according to local sources.
“With no capital gains tax, ease of buying and selling (crypto) anonymously and spending with cash makes life very easy for an enthusiast (in Dubai),” said a source who spoke to BeInCrypto on the condition that they would not be named.
“Compared to most industrialized countries, I would say that Dubai is one of the easiest and best places to come and realize and spend crypto gains. Being able to buy property and cars directly for bitcoin is very unique and in many western countries not even possible,” they added.
Dubai a growing crypto hub
One of the things that make both Dubai and the UAE an attractive crypto destination is the ease of converting bitcoin (BTC), or most other cryptocurrencies, into cash with low fees while remaining almost anonymous. Exchanges generally require basic know-your-customer (KYC) identity and “nothing more.”
In the case of Cointral, a Turkish-owned exchange with an over-the-counter (OTC) desk in the emirate, “you just walk in and trade on the spot,” the source told BeInCrypto during an interview. Cointral charges a general fee of 3%, which looks pricey, but “there are also many local dealers you can find to make low to high volume peer-to-peer (P2P) trades with fees around 1%.”
UAE-based online exchange Bitoasis offers similar OTC services, said the source, allowing “people to buy and sell with local bank transfers.” Both Cointral and Bitoasis did not respond to requests for comment. However, cryptocurrency use in Dubai is so fluid that the central government has adopted deliberate strategies to advance mainstream usage.
The future of payments
In February, a government-owned entity in Dubai, Kiklabb, began accepting BTC, ETH, and USDT as payment for its services. Kiklabb is a free trade zone that helps companies to set up shop in the emirate. Kiklabb issues trading and other licenses as well as visa processing.
The entity also leases office space to its customers on-board the Queen Elizabeth 2 cruise liner anchored at Port Rashid in Dubai. Payments for these and other services can now be made in bitcoin.
Tasawar Ulhaq, chief executive officer of Kiklabb, said that crypto-based payments allow for more accessibility for global entrepreneurs looking to start a business in the UAE. “Cryptocurrencies are the payment method of the future,” he emphasized.
No questions asked
Dubai has generally remained pro-crypto, allowing investors to buy, sell, or hold digital assets at zero taxes — something that seems a complete anathema to most world governments that are pushing new legislation to levy taxes on capital gains from bitcoin. The emirate’s real motivation tends to lean more toward facilitating increased investment within the local cryptocurrency industry.
According to the source:
Dubai and UAE don’t have any tax on income or capital rendering the anti money laundering laws very relaxed. Cryptocurrencies are neither illegal nor recognized as legal tender in the UAE. Banks may question the source of funds when conducting transfers, but generally it’s no questions asked up to very high volume.”
In Dubai, the idea of laissez-faire economics still holds true, at least as far as cryptocurrencies are concerned. The majority of people there, both locals or foreigners, “generally use bitcoin and crypto as speculative vehicles or for remittances. There are several property dealers, car dealers, and even visa agents that accept bitcoin as payment. There is demand from people coming from abroad with money to spend.”
According to reports, the UAE is planning to use blockchain technology for 50% of government transactions this year. The Dubai Future Foundation estimates that the country could save more than $3 billion through blockchain and crypto use.
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