The Middle East has embraced the digital currency explosion and many governments in the Middle East have begun collaborating with financial companies to issue their own cryptocurrencies. In addition, a slew of cryptocurrency exchanges and companies involved in initial currency offerings (ICOs) have begun all over the Middle East, including in the Emirates.
Specifically, the United Arab Emirates (UAE) has taken interest in cryptocurrencies seriously, and plans by the Securities and Commodities Authority of the UAE began regulating initial coin offerings in the first quarter of 2019.
Buying Bitcoin in the UAE is easy, but what matters most is the broker or exchange you select. Open an account at a cryptocurrency exchange: It’s the first step to buying Bitcoin in the UAE. You must also get a crypto wallet to store your bitcoins, make purchases and receive gifts.
Bitcoin continues to dominate the cryptocurrency market as the best cryptocurrency because of its popularity, liquidity and acceptance as payment with a growing list of merchants. Bitcoin’s current market cap of $68.3 billion dwarfs that of all other cryptocurrencies, followed by Ripple’s market cap of only $14.3 billion. Bitcoin has been available in the Emirates since 2014, and with the market for digital currencies growing exponentially in the Middle East, it will likely only increase in popularity.
Overview: Buying Bitcoin in the UAE
The most liquid cryptocurrency, buying Bitcoin in the UAE involves accessing a cryptocurrency exchange that allows Emiratis to open accounts. Bitcoin is universally accepted and works for the purchase of virtually all cryptocurrencies. Several local cryptocurrency exchanges offer bitcoins, as well as a number of other digital currencies.
Due to its low taxation rate, supportive regulatory environment and political stability, a number of exchanges and digital currencies base themselves in the Emirates. In addition, official support for cryptocurrencies makes bitcoins an attractive investment for some Emiratis, although their values can fluctuate dramatically relative to national currencies.
You can use local exchanges or select one of the many international exchanges that accept accounts from the Emirates. In addition, sites such as localbitcoins.com publish local buyers and sellers in the UAE, along with payment methods and bid and offer prices.
You also need to get a wallet to withdraw your bitcoins to and store them after you buy the currency from an exchange or from a local bitcoin seller. You can find a partial list of both local and international exchanges where Emiratis may purchase BTC, as well as several different types of crypto wallets used to store your BTC after purchase.
Another option for trading BTC involves speculating on the movements of the crypto by using contracts for difference (CFDs). This requires you to open an account with an online broker, such as XTB, for example, and does not require a wallet or exchange account. Keep in mind that if you are using a broker and trading BTC CFDs, you never actually possess the bitcoins and cannot use them to pay for goods and services or receive gifts and payments.
Step 1: Open an Account at a Cryptocurrency Exchange
Here’s a partial list of cryptocurrency exchanges based in the UAE and internationally that accept accounts from Emiratis:
Founded in 2015 and based in Dubai, BitOasis is one of the largest cryptocurrency exchanges in the Middle East.
In addition to BTC, supported currencies include Ethereum (ETH), Bitcoin Cash ABC (BCH), Bitcoin Cash SV (BSV), Ripple (XRP), Litecoin (LTC), ZCash (ZEC), Monero (XMR), Ethereum Classic (ETC) and Stellar (XLM). The exchange requires a minimum deposit of 300 AED that can be accepted via bank transfer.
One of the Emirates’ newest exchanges, Palmex was established in 2018 and is based in Dubai. The exchange offers a variety of digital currencies in addition to BTC, which include DubaiCoin (DBIX), Ethereum (ETC), Ripple (XRP) and others. Its site claims high security standards and minimal trading fees. The company does not accept fiat currency for deposit, so you must open an account with Bitcoin or other accepted cryptocurrencies.
Based in Taiwan, Bitfinex supports several professional trading features such as margin trading. In addition to BTC, Bitfinex supports Ethereum (ETC), Ripple (XRP), Litecoin (LTC) and Monero (XRM), among many others. You can make deposits and withdrawals using bank transfers.
Based in the U.K., BC Bitcoin accepts clients from the Emirates and focuses on fast deposits and withdrawals in addition to providing excellent customer support. Supported cryptocurrencies other than BTC include Ethereum (ETC), Litecoin (LTC), Ripple (XRP) and Monero (XRM), to name just a few.
The exchange requires a minimum deposit of £500 that can be made through a SEPA credit or bank transfer. Prospective clients are charged a deposit fee of $10, €10 or £10, depending on the currency used to open the account.
U.K.-based CEX.io accepts customers from around the world, including the Emirates. In addition to offering BTC and other cryptocurrencies, this exchange allows you to trade nine forex currency pairs. CEX.io accepts Crypto Capital, Visa and MasterCard credit cards, SEPA credit transfers and bank transfers for funding cryptocurrency purchases.
The company charges an instant trade fee of 7% and 3.5% + $0.25 for Visa transactions.
Based in Malta, Changelly is a non-custodial “instant” cryptocurrency exchange that acts as an intermediary between exchanges and users. In addition to BTC, Changelly supports Bitcoin Cash (BCH), Ripple (XRP) and Etherium (ETH).
The exchange accepts USD or EUR for deposits, and according to its website, provides the best crypto-to-crypto rates in the business. This exchange allows you to trade among the largest cryptocurrency exchange platforms, including Binance, Bittrex and Poloniex. Deposits can be made with Visa or Mastercard credit cards and are assessed a 5% Simplex card processing fee with a $10 minimum.
In addition to the above-mentioned exchanges, you can also buy and sell bitcoins through localbitcoins.com. The company publishes an online list of buyers and sellers located in the Emirates.
Step 2: Get a Cryptocurrency Wallet
In order to have full control over your BTC or any other cryptocurrency transactions, you must withdraw your bitcoins from the crypto exchange or another source to a personal crypto wallet and then protect your wallet’s key appropriately. The wallet communicates to the crypto network when you want to send and receive transactions.
A wallet address is similar to an email address, except that you can use your wallet address to make purchases and receive payments. Wallets can be installed on a desktop computer, laptop or tablet, as well as on an Android or iOS smartphone.
Another type of wallet is a web-based wallet that does not require a download and gives you access to your cryptocurrencies anywhere with an internet connection. Furthermore, a hardware wallet can be used instead that consists of a peripheral device which plugs into a computer similar to a USB memory stick.
Atomic, the universal multi-asset desktop wallet, lets you buy bitcoins with USD or EUR via your credit card. The wallet supports more than 300 coins and tokens besides BTC in a single interface. Transactions carry a $20,000 limit per transaction.
The completely wireless Bitfi wallet comes in a smartphone-like device and supports an unlimited number of cryptocurrencies and crypto assets. The wallet provides total security from online and offline security threats and allows you to manage all of your cryptocurrencies on one dashboard.
Coinomi is a mobile cryptocurrency wallet that offers a single platform with over 300 cryptocurrency wallets and tokens in addition to BTC. The wallet also has the ability to exchange currencies at no cost.
This wallet platform was specifically designed for merchants and accepts 65 altcoins in addition to BTC. The wallet supports more than 230,000 vendors in 182 countries. Coinpayments.net also supports popular shopping carts used by many e-commerce stores, such as Opencart, Magento and WooCommerce.
Ledger Nano S
One of the most popular hardware wallets available, the Ledger Nano S wallet protects your assets through a PIN code. This wallet also supports more than 40 cryptocurrencies, in addition to Bitcoin. Ledger Nano S claims that its wallet cannot be hacked and was designed around a chip similar to those used in passports and credit cards.
Step 3: Withdraw your BTC to your Wallet
After you buy your bitcoins on an exchange or another source, you may withdraw the currency to your personal bitcoin or multi-currency wallet. Leaving your bitcoins in an exchange can be risky since exchanges can get hacked and you do not have control of your private keys.
Always store your bitcoins on a wallet with your own private key. After you have successfully withdrawn your currency from the exchange, you have successfully purchased BTC.
In addition to acquiring bitcoin on cryptocurrency exchanges, you can source bitcoins locally through localbitcoins.com. The most important decision you can make consists of whether you want to invest or speculate on the exchange rate for BTC quoted against other crypto or national currencies.
If you want to trade BTC using CFDs in an online brokerage account, you can simply open an online account with a broker and download its trading platform. You can also acquire the bitcoins at an exchange or other source and take possession of the cryptocurrency in a wallet to invest in or spend.
Regardless of your decision, due to the extreme volatility in BTC (and most other cryptocurrencies, for that matter), you should have some knowledge of how to trade cryptocurrency before you begin.