For The Time Being, Crypto Transactions Typically Require the Use of Currency to Complete the Transaction
Dubai is moving closer to enabling cryptocurrency to be used to buy and sell real estate. However, there are currently tight requirements for issuing a SPA. Only a few years ago, cryptocurrency trades for real estate appeared far-fetched, if not impossible. Although it is still uncommon, numerous builders in Dubai are working to make this a reality.
Dubai is starting to accept cryptocurrency as a form of payment for real estate, and as crypto payment choices become more prevalent, cash and finance are no longer the only methods to invest in Dubai’s growing real estate market. The recently proposed crypto regulations are expected to bolster the position of these digital forms of currency even further, and the idea that they would now be regulated is expected to boost industry stakeholders’ confidence significantly.
So, can you go buy a house with literally non-existent currency? Yes, however, there is a minor detour involved. In Dubai, cryptocurrency property purchases are now primarily cash transactions. Crypto is first turned into cash by a cryptocurrency exchange house/brokerage firm. Only after the conversion is complete can the transaction be completed. That is because the UAE’s Central Bank has not yet approved the usage of digital currencies as a payment method.
Dubai, on the other hand, has taken aggressive measures in this area, enacting Law No. 4 of 2022 and establishing the Virtual Assets Regulatory Authority (VARA) Dubai to guide the emirate into a safe and controlled future of virtual assets, such as crypto and non-fungible tokens (NFTs).
For the time being, the entire property purchase procedure resembles the usual usage of a house loan or cash to secure a contract for a specific property, instead of some sci-fi-inspired interactive virtual transaction. More developers are beginning to provide these still-novel payment options, but they are still far from being the norm.
That is not to say it will not happen in the future; we are rapidly heading toward virtual assets, especially their use in transactions.
Why Should You Use Cryptocurrency?
The use of virtual assets as a primary means of payment for property transactions would have a number of advantages. Crypto purchases are less expensive due to lower transaction fees compared to traditional payment methods. Leading crypto exchanges charge significantly lower fees for fund transfers than traditional financial institutions, ultimately lowering expenses for all parties.
Furthermore, digital money transactions are far more convenient because they can be performed virtually instantly. There is no need to transfer money among foreign banks or wait days for currency conversions; you simply pay for what you want right away. Another significant benefit is that crypto transactions involve far less documentation. This reduces the number of time processes take and increases their simplicity and ease.
“In Dubai, builders may well not publish or sign SPAs using Bitcoin or any other kind of crypto mentioned as the currency…,” says Farhad Azizi of Azizi Ventures. If you decide to go this path after carefully weighing the advantages and disadvantages, there are a few things to keep in mind:
Developers in Dubai are prohibited from issuing or signing SPAs with Bitcoin or other cryptocurrencies indicated as the currency. In brief, sellers and buyers must execute the deal through a licensed crypto-trading company, a third-party broker who will handle the conversion. As a result, contrary to popular belief, it is not a straightforward transaction. Developers that take Bitcoin or any other cryptocurrency as payment will always complete their SPAs in UAE dirhams and receive government fiat currency.
It is critical to choose a licensed trading organization and verify its legality by confirming. That the services it provides comply with local regulations when Buy a home in Dubai Cryptocurrencies. Generally, well-established, well-known developers can recommend such recognized trading partners, easing your purchasing process.
In a short, the UAE’s rules now prohibit the direct sale or purchase of property using cryptocurrencies. For such transactions, the emirates need the use of their numerous registered third-party services. To verify that everything is done in conformity with the law and current laws and regulations.
Even as the world of cryptocurrency rapidly gains pace and investors seek to purchase with the new medium of exchange. We may expect more legal structures to be formed in Dubai, for the advantage of all.