After the US decision, is it time for UAE enterprises too to buy up Bitcoin?

Dubai: The US is going to be all in on cryptocurrencies being bona-fide assets in themselves. With Trump at the helm of affairs, that certainly is the case, opening up the possibility that the US could even create a national cryptocurrency stockpile.

Is it time then for UAE enterprises to build up their own exposures to Bitcoin and other cryptocurrencies? Among UAE’s publicly listed companies, it’s only Phoenix that’s out and out in the crypto space.

That could soon change.

“There are early signs of engagement,” said Khurram Shroff, CEO of iMining Technologies and adviser to 3iQ, which was the world’s first Bitcoin ETF.

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“Some banks, like UAE’s first digital bank, Mbank, are starting to facilitate crypto-related services. Conversations around adoption and collaboration are happening, and it’s clear that institutions are preparing for a future where digital assets play a larger role.”

This is where any US government directed push for crypto assets can be so influential even at the local level. The UAE already has a significant share of retail investors actively trading in Bitcoin, irrespective of whether the crypto is trading at $100,000 plus or under $20,000 (which it did in December of 2022).

According to sources in the virtual assets space, all that institutions needed was a further prompt.

It was last month that VersiFi, a digital asset trading and lending firm, received its in-principle approval from the Financial Services Regulatory Authority (FSRA) under ADGM. This would lead to the company being able to launch a ‘fully-regulated ‘digital asset trading solution for institutional clients from its base in ADGM.

“Institutional adoption - which slowed down in 2022-23 - has been increasing in 2024,” said Sameer Shalaby, founder and CEO of VersiFi. “This interest was supported by the ETF approvals in the USA in early 2024 -and continued to gain momentum recently following the (Presidential) election.

“All indicators are pointing to continued momentum in 2025 and beyond with estimated growth of over 25% annually in the next 2-3 years, with strong institutional adoption.

“The UAE, and specifically ADGM and Dubai, have positioned themselves as crypto hubs with strong regulatory infrastructure.”

But there are still many who would prefer to give it more time to see how Bitcoin prices function over a longer period. The fact that it broke through from $18,000 in 2022 to today’s $104,000 plus suggests the heavy volatility that’s built into the asset.

“More than anything, institutional investors will want to know at what levels Bitcoin (and other cryptocurrencies) would stabilize on the downside,” said a CFO. “As important as how much it can gain is finding out what would be an ideal price floor on the downside.

“Enterprises don’t want to take on assets with that kind of price swing we have been seeing in these last few years.”

Enter the USA

This is where the US decision to explore the possibility of a national ‘Strategic Bitcoin Reserve’ could be the ‘dawn of a global crypto arms race’, according to Nigel Green of deVere Group.

“We believe that the US’s Strategic Bitcoin Reserve is not just a possibility but an inevitability—one that would be expected to set off a cascade of similar policies worldwide,” he said.

“Countries around the world would then be – if they’re not already, as reports suggest - racing to acquire Bitcoin in anticipation of its role as a cornerstone of a new global financial order.”

That could, soon, mean UAE enterprises too should get to buying Bitcoin…