The launching of the Bitcoin Fund on Nasdaq Dubai was a significant achievement for digital currencies in the GCC region.
Managed by 3iQ Corp, it permits indirect investment in Bitcoin by trading its units within a mature financial market environment.
Similarly, the process of cryptocurrency trading has grown so popular in the region that Arab trading platforms have emerged, enabling Gulf residents to invest in Bitcoin and other currencies.
The following is a list of the most popular exchange platforms in the GCC region:
BitOasis
BitOasis is one of the leading platforms for trading cryptocurrencies — including Bitcoin, Ether, XRP and Bitcoin Cash — in the Middle East and North Africa, with a trading fee of 0.5 percent of the investment value, which can exceed $6,000.
BitOasis was founded in 2015 and is based in the UAE. The UAE Financial Regulatory Authority granted permission to its Abu Dhabi-registered business BLEX Financial Limited to provide financial services in Abu Dhabi in April 2021.
In a statement, the company also announced it had been granted permission to operate a regulated Multilateral Trading Facility or MTF and a custodial platform for virtual assets in the Abu Dhabi market.
Emirex
The Emirex cryptocurrency exchange, which Gregory Rypalchenko and Irina Heaver launched in early 2017, is also operating in the UAE. Although it is based in Lithuania, it attracts mainly Arab investors in the Middle East.
According to the platform’s data, the UAE, Bahrain, Saudi Arabia, and Kuwait are among the Middle Eastern countries that exchange the most digital currencies.
The cost of trading currencies and digital assets on the Emirex platform is 3.2 percent of the investment volume.
Having announcing a partnership with Alpha Sigma Capital in 2020, the company apparently wants to build an infrastructure that will connect the Middle East and Asia’s markets with Africa, Europe, and eventually the United States.
More than 100,000 people are signed up on the platform, which has more than 30,000 active traders from across the world. It also has around 50 trading pairs listed on its exchange, and 150,000 subscribers on social media platforms.
Rain
According a statement the company issued in July 2019, Bahrain’s Rain platform, which received a full regulatory license from the Central Bank of Bahrain, is the first cryptocurrency exchange to obtain a regulatory license in the Middle East.
Rain Management, which operates the platform, was founded in 2017 and is headquartered in Bahrain. Bahrain’s Central Bank licensing makes Rain subject to capital reserve requirements, cybersecurity, and banking compliance standards.
Rain allows investors to securely buy, store, and sell cryptocurrencies such as Bitcoin, Ether, and Litecoin using a bank account or a bank card.
In addition, an investor may trade in digital pairs. The cost is 1.5 percent of the value of investments made via bank transfers and 4 percent of transactions made via bank cards.
Yallabit
Kuwait-based Yallabit provides services for buying and selling five types of cryptocurrencies: BTC, BCH, ETH, XRP, and LTC.
The company was founded by current CEO Talal Al-Yaseen and Chief Technology Officer Ali Taqi.
The cost of investing through the Yallabit platform amounts to 0.5 percent of the investment volume, and it operates in Saudi Arabia, the UAE, Bahrain, Kuwait, and Oman. Bitcoin is the most popular currency on the website of the trading platform.
Crypto ATMs
According to a report by Research and Markets, the global crypto ATM market was worth $18.35 million in 2019, and was expected to reach $542.52 million by 2027, rising at a CAGR of 52.7 percent over the forecast period.
Fluctuations in monetary regulations, increased financial transfers in developing economies, and a rise in the number of crypto ATM installations are some of the key factors pushing the market’s growth.
However, government rules banning the use of cryptocurrencies in certain countries are a significant obstacle to the market’s growth.
A crypto ATM is a physical machine that allows users to purchase Bitcoin and other cryptocurrencies with cash, debit, or credit cards. Some models are bidirectional, enabling digital currencies to be traded for cash.
A crypto ATM is not the same as a traditional commercial bank or bank-backed ATM. Instead, cryptocurrencies are designed to be free from government manipulation and control.
General bytes SRO, Covault, Mainstreet Automaten GmbH (Orderbob), bitaccess Inc, Genesis Coin, Coinme, RusBit Ltd., bitxatm, Coinsource, and Lamassu are among the leading players in the crypto ATM market.
US has highest number of crypto ATMs
According to research published recently by Crypto Head, the United States is the world’s most crypto-ready country.
With a score of 7.3 out of 10, the US came out on top of Crypto Head’s rating, owing to its high number of crypto ATMs compared with other countries. The US has 17,436 crypto ATMs in operation, as of 2021.
As companies such as Coin Cloud continue to expand their operations across the country, the machines’ footprint is constantly increasing.
Canada was the first country to approve cryptocurrency regulation in 2014, and it currently ranks second in the crypto-ATM league with 1,464, followed by the UK with 200 machines.
ATMs in the GCC
Despite the UAE government’s warnings against investing in Bitcoin, many people in Dubai are trading in this virtual currency.
The UAE scored 5.64 out of 10 on top of Crypto Head’s rating, with an annual increase of 168.6-percent crypto searches. While Bitcoin is not considered legal tender in Dubai, there are no restrictions on buying or selling it.
In March 2019, only one crypto ATM was set up in Dubai. However, its functioning was stopped a few days later due to noncompliance.
Elsewhere in the region
While some Arab countries have authorized trading platforms, others such as Algeria and Qatar have forbidden people from dealing in these currencies.
Algeria, for instance, prohibited the trading of cryptocurrencies in 2018 and declared that those who disobeyed the restriction would be punished under existing financial regulations.
In Morocco, the central bank and the Ministry of Economy have warned against investing in virtual currencies.
Qatar’s central bank’s Department of Supervision and Control of Financial Institutions warned banks against dealing in Bitcoin, exchanging it for another currency, creating an account to deal in it, or sending or receiving money transfers to buy or sell it.
In Egypt, the central bank recalled a law passed in 2020 that imposed deterrent penalties, such as imprisonment and significant fines, for dealing in cryptocurrencies, promoting them, or operating platforms for trading them.
In addition, it warned that investing in these currencies was risky, with the possibility of a sudden loss of value, because they are not issued by any central bank or official authority.