UAE robo-advisory Sarwa introduces cryptocurrency trading

Trading app allows retail investors to buy and sell Bitcoin, Ether and other digital tokens

UAE retail investors using the Sarwa Crypto service will not have to pay commissions or transfer fees. Reuters

UAE low-cost, robo-advisory platform Sarwa set up cryptocurrency trading on its app to tap into demand for digital assets amid price volatility.

Sarwa unveiled its zero commission, zero transfer fee stock trading service, Sarwa Trade, in November last year for retail investors to buy and sell more than 4,000 US-listed stocks and exchange-traded funds (ETFs).

The new Sarwa Crypto service will allow them to trade Bitcoin, Ether, Litecoin and Bitcoin Cash without having commissions and transfer fees levied on UAE bank accounts, Sarwa said on Tuesday.

“There is a significant amount of interest around cryptocurrency in the GCC, even with the recent market development,” said Mark Chahwan, co-founder and chief executive of Sarwa.

“Yet, you didn’t have a platform that offered a centralised view of stocks, ETFs and crypto in one app. You do now.”

Bitcoin traded above $30,000 on Tuesday as investors and strategists said the digital currency was showing signs of bottoming out. Ether and smaller tokens were also up.

Rising interest rates around the world have triggered a sell-off in risk assets this year, sending Bitcoin down 34 per cent since December 31.

About 33 per cent of UAE residents have invested in cryptocurrencies, according to a survey in April by online market research company Toluna. Residents in the UAE plan to allocate 26 per cent of their investable assets to cryptocurrency, the survey found.

“We are launching with the four most recognised cryptocurrencies to give a point of entry in a volatile market,” Mr Chahwan said.

“With virtual assets gaining ground and popularity, even authorities are seeing that the potential of the industry is immense and are making sure they create the right frameworks.”

Dubai adopted a law to regulate virtual assets in March this year. The Dubai Virtual Asset Regulation Law is aimed at creating an advanced legal framework to protect investors and provide international standards for virtual asset industry governance that will promote responsible business growth in the emirate.

The emirate's Virtual Asset Regulatory Authority, which will be established under the new law, will regulate the sector throughout the emirate, including all special development zones and free zones, except for the Dubai International Financial Centre (DIFC).

Sarwa’s offering comes as a response to its community’s need and market insights, with many retail investors looking to diversify their portfolio to include cryptocurrencies, the robo-advisory platform said.

About 67 per cent of UAE residents are interested in investing in cryptocurrencies within the next five years, according to a March survey by market research company YouGov, which polled 20,000 respondents in 18 markets from December 15 to 30 last year.

Twenty-one per cent of consumers in the UAE also said they intend to trade in cryptocurrencies in the next 12 months, the highest globally after Indonesia (25 per cent) and India (22 per cent), the YouGov survey found.

The launch of cryptocurrency trading on the Sarwa app “will make it easier to centralise different investments in one app, from hands-off long-term investing to self-directed trading”, the platform said.

Sarwa’s trading platform includes features such as daily and weekly investing news, it said.

Users can engage in fractional trading, create watch lists, as well as place limit and stop orders on the platform, the company said.

Founded in 2017, Sarwa uses artificial intelligence to rate an investor’s risk tolerance and assigns them a tailored investment portfolio of ETFs, charging them lower advisory fees than traditional financial advisers and wealth managers.

In August last year, Sarwa, which is regulated by the ADGM Financial Services Regulatory Authority, raised $15 million in a funding round led by Abu Dhabi's Mubadala Investment Company.

The series B round brings the trading platform’s total funding from regional and international investors to about $25m since it was founded, the company said at the time.

Cryptocurrencies are not licensed by the UAE Central Bank, although a number of cryptocurrency exchanges have been given permission to operate within the Abu Dhabi Global Market.

The UAE dirham is the only legal tender in the country that is recognised by the Central Bank.

The Sarwa Trade app is available on the iOS and Android operating systems.