Retail investments, valued up to $10,000, accounted for 4.6 per cent of all cryptocurrency transfers in the UAE, according to Chainalysis. AFP
Retail investments, valued up to $10,000, accounted for 4.6 per cent of all cryptocurrency transfers in the UAE, according to Chainalysis. AFP
Retail investments, valued up to $10,000, accounted for 4.6 per cent of all cryptocurrency transfers in the UAE, according to Chainalysis. AFP
Retail investments, valued up to $10,000, accounted for 4.6 per cent of all cryptocurrency transfers in the UAE, according to Chainalysis. AFP

UAE's crypto transactions hit nearly $35bn amid rising regulatory clarity


Deepthi Nair
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  • Arabic

The value of cryptocurrency transactions received by the UAE reached nearly $35 billion between July 2022 and June this year, amid increasing regulatory clarity, a report by blockchain data platform Chainalysis has found.

While this represents a 17 per cent drop compared with the previous year, the UAE's crypto market fared much better than many other countries in the region, including Qatar, which reported a decline of 26 per cent, Oman (49 per cent), Jordan (55 per cent) and Lebanon (96 per cent), according to the Middle East and North Africa findings of Chainalysis’s fourth annual Geography of Cryptocurrency Report.

In Saudi Arabia, the crypto economy grew more over the past year than any other country, with a year-over-year transaction volume growth of 12 per cent, the report found.

“In fact, Saudi Arabia was one of just six countries to see any year-over-year transaction volume growth during the time period,” the Chainalysis report said.

The Mena region has the sixth-largest crypto economy in the world, with an estimated $389.8 billion in on-chain value received between last July and June. This represents nearly 7.2 per cent of global transaction volume during the period, the report added.

In March last year, Dubai adopted a law to regulate virtual assets to provide investors with a safe environment while embracing emerging technology as interest in cryptocurrencies grows.

The Virtual Assets Regulatory Authority was established by Sheikh Mohammed bin Rashid, Vice President and Ruler of Dubai, under the Dubai Virtual Asset Regulation Law, the first law of its kind in the emirate.

The body aims to create an advanced legal framework to protect investors and provide international standards for virtual asset industry governance to enable responsible business growth.

In 2018, the Abu Dhabi Global Market established a regulatory framework for spot crypto asset activities.

It has been a tumultuous 12 months for the global cryptocurrency sector since the collapse of a number of large platforms including Celsius, Three Arrows Capital and Sam Bankman-Fried’s FTX, which filed for bankruptcy in the US on November 11.

Bitcoin was trading at about $26,344 on Tuesday morning.

In May, Bitcoin climbed above the $30,000 mark for the first time since June 2022, but is still down more than 50 per cent from its record high of more than $68,000 in November 2021.

Meanwhile, the Chainalysis report found that 67 per cent of cryptocurrency transactions in the UAE between July 2022 and June this year were driven by institutional investments valued at more than $1 million.

This was followed by crypto transfers for professional investments ($10,000 to $1 million), while retail investments (up to $10,000) accounted for 4.6 per cent of all transfers in the Emirates, the report found.

“The fact that by far the larger portion of crypto investments in the UAE is for institutional and professional-sized transactions indicates an eagerness from organisations and high-net-worth individuals to add cryptocurrency to their investment portfolios,” said Kim Grauer, director of research at Chainalysis.

“This market confidence is validation of the efforts being made by the country’s leadership to offer regulatory clarity and establish the nation as a global crypto hub.”

Also, the UAE was one of the only countries across the Mena region to see a higher share of crypto activity taking place on decentralised exchanges (48 per cent), rather than on centralised exchanges (46 per cent), according to the research.

“The outsized popularity of DeFi in the UAE further validates the success the country has had in passing innovation-friendly regulatory frameworks that allow groundbreaking crypto platforms to develop with oversight that keeps consumers safe,” the Chainalysis report said.

India emerged as the top cryptocurrency market in the world and difficulties around tax laws in the country do not appear to have dampened the enormous demand for digital tokens, the company’s Global Crypto Adoption Index found.

The Philippines and Pakistan ranked sixth and eighth, respectively, on the index for grassroots crypto adoption globally.

“This bodes especially well for the UAE, where these nationalities represent a significant portion of the expat population. The surging popularity among people of these nations is likely to correlate with increased crypto adoption in the UAE as well,” Ms Grauer said.

While the hype around non-fungible tokens peaked in early 2022 and has since sharply declined, the number of web traffic visits to NFT sites in the UAE exceeded four million from July 2022 to June this year, Chainalysis found.

“This retained interest in NFTs in the UAE offers businesses the opportunity to grow past the hype and start to introduce practical use cases based on this technology,” Ms Grauer said.

“NFTs have the potential to enhance consumer experiences in the UAE through their application in a diverse range of purposes, including title deeds, music festival ticket sales, charity donations and analysing gaming trends.”

Essentials

The flights
Whether you trek after mountain gorillas in Rwanda, Uganda or the Congo, the most convenient international airport is in Rwanda’s capital city, Kigali. There are direct flights from Dubai a couple of days a week with RwandAir. Otherwise, an indirect route is available via Nairobi with Kenya Airways. Flydubai flies to Kinshasa in the Democratic Republic of Congo, via Entebbe in Uganda. Expect to pay from US$350 (Dh1,286) return, including taxes.
The tours
Superb ape-watching tours that take in all three gorilla countries mentioned above are run by Natural World Safaris. In September, the company will be operating a unique Ugandan ape safari guided by well-known primatologist Ben Garrod.
In the Democratic Republic of Congo, local operator Kivu Travel can organise pretty much any kind of safari throughout the Virunga National Park and elsewhere in eastern Congo.

The biog

Alwyn Stephen says much of his success is a result of taking an educated chance on business decisions.

His advice to anyone starting out in business is to have no fear as life is about taking on challenges.

“If you have the ambition and dream of something, follow that dream, be positive, determined and set goals.

"Nothing and no-one can stop you from succeeding with the right work application, and a little bit of luck along the way.”

Mr Stephen sells his luxury fragrances at selected perfumeries around the UAE, including the House of Niche Boutique in Al Seef.

He relaxes by spending time with his family at home, and enjoying his wife’s India cooking. 

Key facilities
  • Olympic-size swimming pool with a split bulkhead for multi-use configurations, including water polo and 50m/25m training lanes
  • Premier League-standard football pitch
  • 400m Olympic running track
  • NBA-spec basketball court with auditorium
  • 600-seat auditorium
  • Spaces for historical and cultural exploration
  • An elevated football field that doubles as a helipad
  • Specialist robotics and science laboratories
  • AR and VR-enabled learning centres
  • Disruption Lab and Research Centre for developing entrepreneurial skills
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The bio

Favourite book: Kane and Abel by Jeffrey Archer

Favourite quote: “The world makes way for the man who knows where he is going.” - Ralph Waldo Emerson, American essayist

Favourite Authors: Arab poet Abu At-Tayyib Al-Mutanabbi

Favourite Emirati food: Luqaimat, a deep-fried dough soaked in date syrup

Hobbies: Reading and drawing

UAE currency: the story behind the money in your pockets
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Sole survivors
  • Cecelia Crocker was on board Northwest Airlines Flight 255 in 1987 when it crashed in Detroit, killing 154 people, including her parents and brother. The plane had hit a light pole on take off
  • George Lamson Jr, from Minnesota, was on a Galaxy Airlines flight that crashed in Reno in 1985, killing 68 people. His entire seat was launched out of the plane
  • Bahia Bakari, then 12, survived when a Yemenia Airways flight crashed near the Comoros in 2009, killing 152. She was found clinging to wreckage after floating in the ocean for 13 hours.
  • Jim Polehinke was the co-pilot and sole survivor of a 2006 Comair flight that crashed in Lexington, Kentucky, killing 49.
Updated: September 26, 2023, 1:00 PM`