Cryptocurrency demand expanding in UAE
The demand for cryptocurrencies and digital assets is set to accelerate rapidly in the near future in the UAE and other GCC countries, as global trading volumes for crypto assets continue to soar. The UAE is at the forefront of crypto adoption. It has become a powerhouse. With crypto transactions worth over $210 million, the UAE is leaving the US and UK in its wake.
Indeed, the increase in crypto transaction numbers catapulted the UAE into the list of top countries making digital currency transactions in 2019.
Furthermore, the increasing enthusiasm for cryptocurrencies in the UAE was prevalent at the "2019 Lendit Fintech USA" event, during which a comprehensive framework for fintech firms to join new markets was unveiled by Dubai International Financial Centre (DIFC).
The DIFC also worked on introducing a white paper regarding the adoption of cryptocurrency in the country, and the available opportunities for fintech firms throughout the Emirates. In addition, Dubai International Financial Centre recently reached a key milestone registering over 100 fintech firms.
This figure shows a three-fold growth in registered fintech companies since the end of last year, representing a steep rise this year as leading regional and global fintech firms opt for the DIFC as their preferred jurisdiction from which to scale their business in this region.
This ongoing rise in trading activity within the cryptocurrency markets highlights heightened institutional participation. Indeed, the cryptocurrency sector is set for further significant expansion in Dubai and throughout the UAE, mainly due to extensive inflows of institutional investors.
Not just governments and their agencies, but also major corporations, financial institutions, universities and eminent investors will all contribute their institutional capital as well as their knowledge, experience and adeptness to the cryptoverse.
Even though the cryptocurrency market has been on this path for quite some time now, the sense is mounting that institutional investors are preparing to move off the sidelines before the end of this year and the start of 2020.
As well as having the crucial advantage of being borderless - thereby making cryptocurrencies ideally suited to business, trade and people - they are also a perfect match to the ever-growing levels of digitalisation around the world. What these latest figures show, and what we're seeing more and more now in the UAE and globally, is the increasing acknowledgement that cryptocurrencies are the present and future of money.
Nigel Green is founder and chief executive of deVere Group. Views expressed here are his own and do not reflect this newspaper's policy.
Meanwhile, The National Council of Commerce and Services of Venezuela (Consecomercio) issued a statement earlier this week making its position clear on both cryptocurrency, such as Bitcoin, as well as the state-backed digital currency, the petro.
José Miguel Farías-a member of Consecomercio's Economics Commission-published the group's statement on Twitter, which indicated that there is a general consensus among businesses in Venezuela that cryptocurrency plays a crucial role in the nation's economy. But the state-backed petro-the brainchild of President Nicolas Maduro to evade U.S. sanctions and stimulate Venezuela's economy-has been a rushed project that will take time to assimilate, the group said.
"The petro has diverse problems and flaws of origin that make it difficult to really know what may be its application in the economy," said the Council. "What is undeniable," the statement added, "is the importance and relevance of the use of cryptocurrencies in Venezuela, given the limitations suffered by citizens and companies when it comes to mobilizing their money."