Years ago, when you mentioned "cryptocurrency," a friend would have pictured some kind of underworld banking system, with traders wearing hoods and sitting behind massive computers. These days, you hear about bitcoin and crypto not only in your daily business news but on the covers of leading publications as well.
This is because cryptocurrencies are attracting more customers and organizations, and governments around the world are trying to put regulations in place that will make it easier for crypto firms to do business while protecting investor interests. A law regulating virtual assets was recently adopted by the UAE, which could potentially attract some of the biggest crypto companies to the UAE.
In 2022, the Middle East's financial services sector will undergo a drastic transformation. Bitcoin, digital payments, and BaaS (banking as a service) are some of the trends shaping this transformation. In the future, cryptocurrency may even replace traditional financial systems globally. Several policies in Dubai support blockchain technology, making it one of the best markets to trade cryptocurrencies.
Some of us still wonder, is cryptocurrency the correct term? Or should it be "digital currency"? Or "virtual asset"? Do cryptocurrencies, whatever name we give them, deserve this much attention?
Cryptocurrency: What is it
Cryptocurrency is a digital currency designed to be used online. The transactions are decentralized and there is no central authority regulating them. A crypto currency is managed by peer-to-peer networks of systems, so anyone can participate from anywhere. Bitcoin, the first cryptocurrency, was introduced in 2008. Over 10000 cryptocurrencies exist today, with Bitcoin, Ethereum, Litecoin, and Bitcoin Cash among the most popular.
Cryptocurrency: How Does It Work
In cryptocurrency, transactions take place on a ledger called Blockchain, which is an open, distributed database containing transactional details in a code format. Cryptocurrencies are generated by mining, a process that relies on computer power to solve complex mathematical problems. You can purchase cryptocurrencies on cryptocurrency exchanges or brokerage firms. Transacting without the involvement of a third party is possible using cryptocurrency. The same people who invest in bonds, stocks, etc. also invest in cryptocurrencies.
What makes cryptocurrencies so popular today
Using cryptocurrencies is easy: Although cryptocurrencies' origins might seem confusing, they can be easily used. Initially, you can purchase cryptocurrency through a crypto exchange, like BitOasis, which can also be accessed from any device connected to the internet. As soon as you get cryptocurrencies, you can use them to buy things, send money, or invest in them.
The purpose of cryptocurrencies is unique: Most cryptocurrencies are linked to Bitcoin, which is the most well-known of all cryptocurrencies. The number of altcoins or alternatives to bitcoin now exceeds 10,000, and most are trying to improve bitcoin. Crypto projects each aim to solve a particular problem for their community. As Litecoin confirms transactions faster than Bitcoin, it is popular among people interested in faster payment settlement. Monero is another altcoin that emphasizes privacy, making transactions untraceable.
A small investment is required: Recently, prices have risen across the globe, and people are concerned that traditional or "fiat" currencies will decline in value. So instead of saving money in banks, they have turned to invest in assets that have long been valuable, such as gold, real estate, stocks, and now cryptocurrencies. The downside is understanding commission and management fees when buying meta or apple stocks. Furthermore, precious metal and property deals require significant capital.
To get started with cryptocurrency, you'll need a small investment and some basic research. Instead of buying an entire bitcoin, exchanges like BitOasis let you purchase crypto worth at least a dollar. Furthermore, cryptocurrency wallets are safe and easy to use when it comes to storage and portability.
Are Cryptocurrencies Legal in Dubai
Cryptocurrencies have not been licensed by the Central Bank of the UAE or recognized as legal tender. However, trading crypto assets on crypto exchange platforms are not prohibited. Residents of the UAE can own, deposit, and trade cryptocurrencies.
Within the financial free zone, the government has allowed some cryptocurrency exchanges to operate. Dubai launched the DMCC Crypto Centre in May 2021 to promote cryptographic and blockchain technologies. DMCC has more than 100 members in the crypto industry. Emirates will have more than 1000 crypto businesses by the end of 2022, according to the DMCC's executive chairman and chief.
How do I buy cryptocurrency in the UAE and Dubai
You can follow these steps to buy cryptocurrency in UAE:
1. Create a trading account: The first step is to open a trading account with a cryptocurrency exchange or broker. eToro, AVAtrade, IQ option, and Saxo Bank are among the best brokers for buying cryptocurrency in the UAE. Similarly, you can open an account with a cryptocurrency exchange like Coinbase, Kraken, and so on.
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2. Deposit money in the account: Following the verification of your trading account, the next step is to deposit funds into the account. Direct bank transfers or credit cards or debit cards can be used.
3. Invest in cryptocurrencies: It may take three days for your deposit to become visible in the account. Once that happens, you can purchase cryptocurrency. Buying cryptocurrencies depends on what you want and what a broker or exchange offers. Coins can either be bought whole or in portions.
4. Store cryptocurrencies: It is important to store your cryptocurrency safely after buying it, protecting it from theft. A hardware-based wallet, or a web-based wallet, with a private key allows you to keep your cryptocurrency purchase secure.
Use of Crypto in Various Industries
Many industries have begun accepting crypto payments for their services, anticipating the growing adoption of cryptocurrencies.
Cryptocurrency accepted in UAE hotels
Some hotels in UAE are now using cryptocurrencies as a payment mode to enhance customer experiences and increase payment options. This move is to make payment more secure, faster, and private.
LucidPay, a well-known name in the UAE hospitality industry, recently announced plans to launch a stablecoin on the Tezos blockchain.
You can now book Al Mahra Resort by Cristal in Ras Al Khaimah using bitcoin or another digital currency.
The UAE hotel brand Stella Stays now accepts cryptocurrency.
Accepting cryptocurrencies for auctions
An auction involving cryptocurrency recently sold a billion-year-old black diamond for $4.3 million. A diamond named "The Enigma" weighing 555.55 carats was named the largest cut diamond in the world in 2006. This diamond was purchased by Richard Hert, an entrepreneur.
UAE restaurants accepting cryptocurrency
A Dubai pizzeria began accepting bitcoins for payment in 2014, initiating cryptocurrency transactions in Dubai. It did not succeed since the cryptocurrency was not well known at the time. Another restaurant in Abu Dhabi accepted cryptocurrency in 2018, but it did not see much success.
Catching up with the trend, some restaurants in UAE started to accept cryptocurrency. Here are some restaurants that Accept Cryptocurrency In Dubai: (Click on the links for location and contact details)
1. Bake N More Factory (accept bitcoins)
2. Meta Terrace
3. Doge Burger
4. Pickl JLT
5. The Bhukkad Cafe
UAE hospitals accepting cryptocurrency
As a means of promoting cryptocurrency use in hospitals, several clinics in the UAE are now accepting bitcoin payments from patients. Other hospitals accept cryptocurrency donations. It is still in progress as hospitals evaluate the risks associated with it.
The UAE Government Agencies Accepting Crypto
A licensing agency in the United Arab Emirates, Kiklabb, has begun accepting cryptocurrency payments. Real estate developers in the UAE are also embracing cryptocurrency, with one announcing that Dogecoin will be accepted as payment.
Virtualzone, a business management consulting firm in Dubai, has also announced it will accept bitcoin payments for business setup services. By making this change, the UAE hopes that businesses from around the world will be able to set up shop there more easily.
Conclusion (Future of Cryptocurrencies in UAE)
As part of the UAE's 2023-2026 strategy, the central bank plans to launch its first digital currency by 2026. Their goal is to become one of the world's top 10 central banks through this move. Financial Services Regulatory Authority (FRSA), Security and Commodities Authority (SCA) and Dubai Financial Services Authority (DFSA) supervise cryptocurrency regulation in Dubai. The provision of crypto services in Dubai requires a licence from the SCA or FRSA.
UAE Securities and Commodities Authority and Dubai World Trade Centre Authority have created a plan to make the Dubai World Trade Center a cryptocurrency zone and regulator. Having this initiative will attract new crypto prospects to Dubai and contribute to the success of the cryptocurrency industry in the UAE.
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