Dubai is one of the most lively gold markets in the world. It is documented that the Dubai gold and commodities exchange witnessed a total value of 162.01 bn in 2022. In the same year, when inflation steadily climbed, investors drifted towards gold, resulting in a surge of interest in gold contracts on the DGCX exchange, a 78% increase in trading volume compared to the previous year.
There was consistent trading in the Indian rupee over 2022 as traders sought to mitigate their exposure to one of the world’s rapidly growing economies.
In addition, DGCX also observed an increasing growth in trading volume for the Yen, Australian Dollar, and Canadian Dollar while witnessing a surge in investor attention towards the Euro and British Currency.
The DGCX Initiated Physical Gold Features and Spot Gold Contracts
- Traders and financial institutions will be offered the capability to utilize physical gold as collateral, which enables them to access valuable short-term financing. Similar to repurchase agreements (repo), these are intended to use together by traders.
- Traders can sell and purchase commodity derivates on the DGCX EOS platform to manage risk, preserve value, and expand their portfolios; these newly launched products are readily obtainable for trading purposes.
- Dubai Multi Commodities Center requires gold delivered through the spot gold contract, should be of fineness of 995 per thousand, and to the ‘UAE Good Delivery’ quality standard.
FinMet and The Dubai & Commodities Exchange (DGCX)
FinMet and The Dubai & Commodities Exchange (DGCX)have teamed up to expand the range of gold products offered by DGCX. The collaboration aims to enhance the available gold product range of DGCX by leveraging its expertise in providing innovative and effective trading solutions.
As part of the agreement, FinMet will review it with DGCX to assess the physical bullion market and pinpoint potential opportunities across various international markets.
FinMet specializes in precious metal technology, trading, training, and logistics. This collaboration could also enable both entities to discover new areas of growth and expansion.
DGCX will get assistance from FinMet to introduce the product structure to onboard banks seeking a more comprehensive range of products to fulfill their business needs.
The expertise FinMet offer will enable DGCX to effectively present its product offerings, adapting them to be more reachable and appealing to potential investors.
Paloma Precious DMCC
In September 2022, the first transaction was successfully completed by Paloma Precious DMCC, a member of DGCX with a prominent UAE bank. This embarked on an Important milestone for DGCX, showing the exchangeability to facilitate secure and efficient transactions for its members.
Subsequently, for the first time, SAM Precious Metals (SPM) received the necessary authorizations to commence trading its gold and silver bars on DGCX on November 2022.
This success later underscored the exchange’s growing reputation as a trusted platform for precious metal trading, attracting more participants and improving its position in the market.
In the year 2022, DGCX got recognized as a third-country CCP(TC-CCP) recognized by the European Securities and Market Authority(ESMA)renewed, affirming the commitment of exchange to uphold global regulatory standards.
The recognition reflects the adherence to DGCX’s most rigorous risk management and governance framework, keeping it a trusted and reliable exchange for investors worldwide.
DGCX has further strengthened its reputation by meeting these international standards, which could bring more growth in business and attract more people.
Israeli Shekel Futures
According to the strategic efforts to expand its FX product range and capitalize on the swiftly growing currency segment, Israeli Shekel Futures were listed by DGCX in June 2022. This move was appreciable for the exchange as it helped to broaden its currency offering and provided investors with a broader range of trading options.
By multiplying its product range in this way, DGCX is making itself a leading player in the global FX market and attracting more participants to its platform.
Setting Up a Gold Business in Dubai
Dubai’s metal market offers promising opportunities for emerging business entrepreneurs or tycoons searching to expand businesses. The exchange of gold with other precious metals and ornaments is essential in the UAE economy.
The UAE has become an ideal destination for an extended period because of the thriving gold market. Gold and diamond have become significant imports in Dubai, constituting almost 20% of the UAE’s total non-oil exports. You can also check out the LLC Company Formation In Dubai for additional reference.
Trade License for Precious Metal Trading in Dubai
If you plan to establish a Business Setup in Dubai that involves trading in precious metals. In that case, seeking a Precious Metal trading license from the Department of Economic Development(DED) is essential.
The DED is responsible for overseeing the procedures for setting up and renewing trade licenses for businesses in Dubai.
To navigate the process developed by DED, businesses person could seek the assistance Business Consultant in Dubai.
Type of Trade License You Should Obtain
The Individuals are authorized to buy and sell precious metals with a ‘Non-manufactured precious metal trading’ license issued by the DED. This commercial license allows individuals to resell the primary ores of precious metals such as gold, silver, platinum, and others in their pre-extraction state, as well as ingots, blocks, threads, or chips in their pre-manufactured form.
To obtain a precious metal Trading License in Dubai, it is necessary to follow these steps without any omission:
- Application fees
- Application form
- Two passport size
- passport/visa copy of the owner
- Copy of sponsors passport
- Manager’s cv
- Trade name
- Attain the initial approval from the DED
- Certificate of initial approval fee payment
- Draft and sign a memorandum (MoA)
- Rent a premise for the enterprise and get the lease agreement endorsed by Ejari.
- Submit all the documents
- Get a precious metal trading license from the DED.
Official external approval is required to acquire from Security Industry Regulatory Agency(SIRA) to start a business setup in Dubai. To install security systems, you need to obtain approval from Dubai police.
The abundance of opportunities provided by this license attracts many people from around the world, and the economic diversity and ease of accessibility all make Dubai globally organized for business setup.