With a significantly subsidised commercial licence, Dubai expects to draw over 600 new web3 ventures by the end of 2023.

Dubai's recent decision to extend substantial subsidies for commercial licenses in the AI and Web 3.0 sector is poised to trigger a rapid increase in investments focused on Web3 technologies throughout the UAE. Industry experts predict that this move will draw more than 600 new ventures into the sector by the end of 2023. This strategic regulatory move by Dubai, particularly in light of policy uncertainties surrounding the sector in countries like the United States, demonstrates a well-calculated effort to position Dubai as a hub for Web3 innovation, aiming to attract global talent and solidify its status as a technological powerhouse.

Currently, the UAE hosts approximately 400 ventures operating within the Web3 sector. Recently, the Dubai AI and Web 3.0 Campus, a dedicated centre for AI and Web3 innovation in the emirate, made a significant announcement. They revealed plans to issue artificial intelligence (AI) and Web3 licenses to support a wide range of activities within the sector. Under this initiative, the AI and Web3 License will be a heavily subsidized commercial license, with a 90 per cent reduction in fees, designed to encourage enterprises to establish their operations in Dubai. Furthermore, the Campus will provide state-of-the-art physical and digital infrastructure to facilitate the growth and expansion of tech companies. These licenses will be granted by the Dubai International Financial Centre (DIFC) to enterprises that have physical offices and co-working spaces within the DIFC's 'Innovation One' building.

“With the latest positive move, we can expect a surge in web3-centric investments across UAE as it will encourage a lot of entrepreneurs to make Dubai their base for expanding in the MENA region,” Manan Vora, SVP – Strategy and business operations at Liminal, a wallet infrastructure and custody solutions platform, told the press. “Companies using blockchain technology and cryptocurrencies are growing rapidly in the city. There are already about 400 of these companies, and by the end of the year, the number is expected to cross 1000,” he added.

The anticipated surge in web3-focused investments in the UAE holds particular significance as global consultancy giant PwC estimates that AI will contribute $15.7 trillion to the global economy by 2030. Additionally, a report by McKinsey forecasts that AI will generate around 200,000 jobs in the Middle East by 2025. According to experts, the DIFC Innovation Hub has already played a leading role in supporting innovative concepts and nurturing Web3 startups through business-friendly policies. This recent initiative is expected to further solidify its reputation as a rapidly emerging global hotspot for Web3 companies.

Furthermore, the timing of this move is noteworthy, coinciding with a period of regulatory ambiguity in advanced markets like the United States concerning the Web3 sector. The latest announcement from the Dubai AI and Web 3.0 Campus is regarded as a strategic step toward positioning itself as the largest cluster of AI and Web3 companies in the region, aiming to capitalize on the projected growth within the sector. Reports suggest that the Campus is planning to attract more than $300 million in capital and create an additional 3,000 jobs by 2028, further cementing Dubai's role as a prominent player in the global tech landscape.