Dubai's OTC Crypto Market Surges with 50 VARA Licenses and Zero Personal Income Tax

Over-the-counter (OTC) crypto trading has become a significant player in Dubai's financial landscape. According to the Virtual Assets Regulatory Authority (VARA), around 50 OTC licenses have been issued since its establishment in 2022, making Dubai one of the most active OTC trading environments globally.

OTC crypto desks in Dubai operate outside public exchange order books, providing bilateral trades with fixed-price quotes and reduced exposure to market slippage. These desks are geared towards institutional clients and high-net-worth individuals, with minimum transaction sizes typically starting around $100,000.

The UAE's regulatory framework is structured to support OTC trading, with VARA and the ADGM framework in Abu Dhabi providing separate licensing pathways for firms. The concentration of licensed OTC desks in Dubai and Abu Dhabi reflects the UAE's position as a regional hub for institutional crypto trading.

The tax structure in the UAE also supports the growth of OTC trading, with 0% personal income tax on crypto gains and a 9% corporate tax only above AED 375,000 in annual profit. Crypto-to-crypto transfers remain exempt from value-added tax.