Welcome back to Lawgical, where we untangle the legal knots so that you do not have to. I am Ludmila Yamalova, a US-qualified lawyer based in Dubai. In each episode, we break down complex legal issues into clear, practical insights that you can actually use.
In today’s episode, we are talking about proprietary crypto or virtual asset trading in the UAE, and particularly in Dubai. This is a topic that comes up constantly from founders, traders, family offices, and even long-term UAE residents who are active in crypto personally and are now asking a very logical question:
Should I be owning crypto through a legal entity instead?
The short answer is: sometimes yes, sometimes no. There are important caveats. While proprietary crypto trading is allowed in the UAE and there are clear licensing pathways, the reality on the ground is more nuanced—particularly when it comes to regulation, structure, and banking.
So today, we will break this down logically.
Why This Conversation Matters Now
Why are we talking about crypto and proprietary crypto trading at this point?
In short, crypto ownership in the UAE has matured—and continues to mature rapidly. We are no longer talking about casual hobby trading or experimental side wallets. Increasingly, we are talking about meaningful portfolios, long-term strategies, disciplined trading activity, and individuals who live in the UAE and want their crypto exposure to be structured, compliant, and sustainable.
That is where proprietary crypto trading through a legal entity enters the conversation.
Personal Crypto Ownership vs. Corporate Ownership
Let us start with the basic distinction.
Personal Crypto Ownership
When you own crypto personally, this is the simplest model. You own the crypto, trade your own assets, and act in your individual capacity. No license is required. This is perfectly legal, common, and widely accepted worldwide—including in the UAE.
Crypto Ownership Through a Legal Entity
This is a different legal universe.
In this case, the company owns the crypto, and the company trades its own capital. You, as an individual, are merely a signatory or authorised representative, not the owner of the crypto itself. Because it is a company, there is regulatory oversight and licensing, disclosure, and compliance requirements.
The moment crypto activity moves from you personally to a company, you are no longer in the same legal category. Many people underestimate how significant this shift is.
What Is Proprietary Crypto or Virtual Asset Trading?
Proprietary crypto or virtual asset trading means exactly this:
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A company trades only its own funds
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For its own benefit
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No client money
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No custody for others
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No brokerage services
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No exchange activity
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No third-party capital
So why would someone—especially someone who has done very well in crypto—choose a company structure instead of personal ownership?
Why People Choose a Corporate Structure
There are several reasons, depending on individual circumstances. Based on what we see with our clients, the most common reasons include:
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Legitimising income
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Risk separation between personal and corporate assets
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Internal governance and controls
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Succession and estate planning
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Long-term capital strategy
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Professionalising trading activity
For UAE residents in particular, having a local compliance structure often aligns with how they live, invest, and plan their future. The structure alone does not equal safety, but it can be very convenient.
Legitimising Income: The Core Driver
The most common reason clients raise is legitimising income.
This comes up especially for individuals whose primary—or only—source of income is crypto trading. Many early crypto investors have done exceptionally well and no longer need traditional employment. Crypto trading sustains them and their families.
However, owning crypto and making money on a wallet does not automatically translate into the traditional financial system. At some point, there is a need to convert crypto into fiat currency. That is where issues often arise.
Banks remain cautious. Regulators increasingly require proof of lawful source of funds. Crypto ownership is lawful, but it exists largely outside traditional banking systems.
A proprietary trading licence can help:
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Confirm that the activity is lawful
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Document the nature of income
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Create an auditable structure
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Support compliance narratives
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Provide consistency over time
What it does not do is equally important:
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It does not guarantee banking
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It does not guarantee acceptance of funds
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It does not immunise against AML scrutiny
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It does not automatically convert profits into salary
Why This Matters for Sole-Income Crypto Traders
Personal crypto trading becomes harder to explain at scale. Once you are investing in real estate, businesses, or long-term residency, questions about source of income inevitably arise.
Banks are often the first to ask:
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Where does the income come from?
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Is it recurring?
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Is it structured?
A corporate structure provides a clearer narrative than simply stating, “I trade crypto personally.”
Additional Benefits of a Corporate Structure
Other reasons include:
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Risk separation: Corporate ownership creates legal separation from personal assets.
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Succession and inheritance planning: Especially relevant as crypto wealth matures.
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Governance and discipline: Corporate trading requires defined authority, policies, records, and accountability.
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Professionalisation: At scale, trading becomes a business operation rather than personal investing.
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Credibility: Licensed entities are easier to explain to counterparties and regulators.
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Regulatory predictability: Rules and expectations are clearer within a regulated structure.
Residency in the UAE
A proprietary trading licence can support UAE residency—either as an owner, authorised representative, or employee. Residency unlocks banking, investment opportunities, company formation, and broader financial participation in the UAE.
Many crypto investors currently establish unrelated companies simply to obtain residency. While workable, this does not accurately reflect the source of income and can lead to governance issues and fund commingling.
A proprietary crypto trading entity aligns residency with reality.
Where Can You Obtain These Licences?
There are three main Emirates offering proprietary crypto trading options:
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Abu Dhabi – via ADGM (regulated by FSRA)
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Ras Al Khaimah – via the Digital Assets Oasis
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Dubai – with the most extensive options
Dubai Options
Dubai includes multiple economic zones:
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DIFC
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DMCC
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Mainland Dubai (DET)
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IFZA
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Meydan Free Zone
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DWTC Free Zone
Regulation is split between:
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DFSA (within DIFC)
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VARA (for the rest of Dubai)
VARA and the NOC Requirement
You are licensed by your economic zone—not by VARA. However, you must obtain a No Objection Certificate (NOC) from VARA confirming that:
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You trade only your own funds
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You do not hold client money
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You are not acting as a broker or exchange
This requirement applies to both new applications and renewals. For older businesses, this has been a new and sometimes frustrating development.
Without the VARA NOC, licences cannot be renewed.
Banking Challenges
Corporate banking remains the biggest challenge. UAE banks are still conservative when crypto appears on a licence.
Some companies have operated for years without local accounts, relying instead on foreign banks. While workable, this creates operational complexity.
OTC Desks: A Word of Caution
Many crypto traders rely on OTC desks to convert crypto to fiat. However, unlicensed desks have been shut down or sanctioned, and users have faced investigations, even criminal cases.
Always verify that an OTC desk is licensed by VARA. Using unlicensed providers can jeopardise both your licence renewal and your legal position.
Final Takeaways
The UAE offers robust options for proprietary crypto trading licences across multiple Emirates. For those whose primary income is crypto, these licences can:
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Legitimise income
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Support residency
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Enable succession planning
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Provide regulatory clarity
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Professionalise operations
Banking remains a challenge, but solutions exist, and progress is expected.
That concludes today’s episode of Lawgical. If you found this episode useful and you like what we do, you can always find more on our website at lylawyers.com. We are also on Apple Podcasts and Spotify, and for the full experience, you can watch our video podcast on YouTube.
Until next time: stay informed, stay safe, and keep things lawgical.