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Khaleej Times
20-05-2025
- Business
- Khaleej Times
New fintech trends reshape digital finance as cryptos gain traction
The global cryptocurrency landscape is undergoing a seismic transformation, driven by fintech innovations such as blockchain, decentralised finance (DeFi), artificial intelligence (AI), and central bank digital currencies (CBDCs). At the heart of this revolution, the UAE has emerged as a global leader, leveraging progressive regulations, a tech-savvy population, and strategic government initiatives to redefine the role of digital assets. With a projected fintech market value of $3.56 billion by 2025 and $6.43 billion by 2030, the UAE is not only a regional powerhouse but also a global model for harmonising innovation with regulatory trust, offering lessons for economies worldwide. The global embrace of cryptocurrencies is accelerating, with over 60% of financial institutions exploring blockchain solutions for enhanced transparency and efficiency, according to Deloitte. Major corporations and banks are integrating crypto services, signaling confidence in digital assets as they transition from speculative investments to mainstream financial instruments. In the UAE, this trend is amplified by a 210% surge in crypto adoption in 2025 — the highest globally — driven by user-friendly platforms and growing retail participation, evidenced by a 41% increase in crypto app downloads in 2024. The UAE's rise as a top-10 global crypto hub is underscored by $30 billion in crypto investments in 2024, fuelled by its business-friendly environment. Major exchanges and fintech startups are flocking to Dubai and Abu Dhabi, attracted by tax incentives, low startup costs, and free zones like the Dubai International Financial Centre (DIFC) and Abu Dhabi Global Market (ADGM). 'Fintech isn't just changing finance in the UAE — it's redefining how and where investors make decisions,' says George Naddaf, managing director of eToro Mena. With 39.1% of UAE residents expected to use crypto by 2025, the nation is on track to realise its vision of a cashless, blockchain-powered economy. The UAE's regulatory framework is a cornerstone of its crypto success. The Dubai Virtual Assets Regulatory Authority (Vara) and ADGM's DLT Foundations Regulation provide legal clarity, fostering trust among investors and businesses. Vara's comprehensive licensing framework has attracted global players, while ADGM's regulations support blockchain innovation. 'The UAE's regulatory sandboxes allow fintechs to test AI-driven solutions safely,' notes Nadeem Ladki, Global Head of Bitpanda Technology Solutions. This balance of innovation and oversight contrasts with regions like China, where stringent policies stifle growth, or Singapore and Switzerland, which also promote progressive frameworks but lack the UAE's rapid adoption rates. Regulation remains a double-edged sword globally. As Chris Brummer, a fintech law professor at Georgetown University, observes, 'Regulators are walking a fine line between protecting consumers and allowing innovation to flourish.' The UAE's approach—clear guidelines without stifling creativity —has created a stable environment, encouraging startups and established firms to innovate. In 2024, UAE-based startups raised $1.1 billion across 207 deals, leading the Mena region and fueling advancements in blockchain and AI. DeFi is revolutionising traditional banking by offering intermediary-free lending, borrowing, and trading. Globally, the total value locked in DeFi protocols exceeds $150 billion in 2024, with platforms like MakerDAO and Compound leading the charge. 'DeFi democratizes access to financial services, providing an alternative to the often exclusionary traditional banking system,' says blockchain expert Laura Shin. In the UAE, DeFi adoption is growing, supported by regulatory sandboxes that allow fintechs to test decentralized solutions. The UAE's focus on financial inclusion aligns with global trends, particularly in emerging markets where 1.7 billion adults remain unbanked, according to the World Bank. Mobile-based crypto platforms are bridging this gap, and the UAE's tech infrastructure positions it to lead in mobile DeFi solutions. By integrating DeFi with its Digital Dirham, the UAE aims to enhance accessibility and reduce transaction costs, particularly for underserved communities. The UAE is at the forefront of CBDC development with its Digital Dirham, set to launch in Q4 2025. This blockchain-based currency will streamline cross-border payments, enhance financial inclusion, and combat financial crime, according to Khaled Mohamed Balama, Governor of the Central Bank of the UAE. The Digital Dirham enables innovative products like conditional payments and fractional asset ownership, unlocking liquidity in real estate and commodities. With 10% of global GDP projected to be tokenized on blockchain by 2027, the UAE's CBDC positions it as a leader in this transformative shift. Globally, CBDCs are gaining traction as governments seek to modernize financial systems. The UAE's proactive approach contrasts with slower adoption in some developed economies, offering a blueprint for integrating CBDCs with private-sector innovation. The Digital Dirham's ability to automate complex transactions, such as multi-party settlements, enhances the UAE's appeal as a fintech hub. Artificial intelligence is reshaping fintech by improving fraud detection, regulatory compliance, and customer personalisation. The UAE's 'Universal Blueprint for AI' aims to position Dubai as a global AI hub, with initiatives like DIFC's AI and Web3 incubator fostering innovation. AI-powered analytics are critical for real-time fraud prevention in crypto transactions, and the UAE's regulatory sandboxes provide a safe space for testing these solutions. Globally, AI is enhancing blockchain scalability and privacy. Layer 2 solutions like Optimism and Arbitrum address transaction speed and cost issues, making crypto viable for everyday use. In the UAE, AI-driven compliance tools are helping fintechs navigate VARA's regulations, ensuring secure and efficient operations. This synergy of AI and blockchain is a key driver of the UAE's fintech growth, projected at a 12.56% compound annual growth rate through 2030. The rise of non-fungible tokens (NFTs) and metaverse integrations is creating new digital economies. Platforms like OpenSea and Decentraland enable users to monetise virtual assets, a trend gaining traction in the UAE's tech-savvy market. The UAE's investment in Web3 technologies, supported by DIFC's incubator, positions it to lead in these emerging spaces. NFTs and metaverse applications are expanding crypto's utility beyond finance across the globe, with the UAE poised to capitalise on this shift through its innovation-friendly ecosystem. The UAE's fintech surge is reshaping its economy, with a robust project pipeline and government policies attracting foreign direct investment. Arif Amiri, CEO of DIFC, highlights the UAE's dynamic ecosystem — featuring an independent regulator, efficient judicial system, and international stock exchange — as a springboard for fintech expansion. The country's competitive edge, including low startup costs and business-friendly free zones, is driving a startup boom, with fintechs leading regional and global innovation. Fintech is a key driver of financial inclusion and stability, as noted by Christine Lagarde, President of the European Central Bank. The UAE's model demonstrates how innovation can coexist with regulatory safeguards, ensuring resilience. By prioritising education and accessibility, as emphasised by eToro's Naddaf, the UAE is sustaining its crypto momentum, with nearly 40% of residents projected to adopt digital assets by 2025. Despite its successes, the UAE faces challenges, including the need to balance regulation with innovation and address cybersecurity risks in crypto transactions. Globally, geopolitical tensions and varying regulatory approaches — such as China's crackdowns — highlight the complexities of crypto adoption. The UAE's proactive stance mitigates these risks, but ongoing investment in cybersecurity and regulatory adaptability will be crucial. Looking ahead, the UAE's fintech leadership offers a roadmap for other economies. By integrating AI, DeFi, CBDCs, and Web3 technologies, the country is setting a benchmark for digital finance. As Nick Cooke, CEO of Atmos, notes: 'In the UAE, crypto drives a fully digitised economy.' With global fintech evolving rapidly, the UAE's ability to harmonise innovation, regulation, and consumer adoption positions it as a beacon for the future of cryptocurrency.
Mid East Info
26-03-2025
- Business
- Mid East Info
UAE's Crypto Adoption Surges by 42%: Embrace Digital Eidiya This Ramadan
Dubai, UAE: What if your Eidiya this year didn't just disappear into a toy store run or a snack splurge—but grew in value over time? As the UAE continues to lead the MENA region in cryptocurrency adoption, a fresh twist on a cherished tradition is emerging digital Eidiya. Rooted in generosity and symbolic of blessings and prosperity, Eidiya—the tradition of gifting money to younger family members during Eid—is being reimagined for the digital era. And there's never been a better time to consider it. Recent figures show that downloads of the top 49 crypto apps in the UAE surged to 15 million in 2024, marking a 41% year-on-year increase. In January 2025 alone, the country recorded 3.55 million crypto app installations, highlighting a clear appetite for digital assets. With user penetration expected to hit 39.1% by the end of 2025, crypto is no longer a fringe trend—it's becoming a household norm. So, what if, instead of the usual cash envelope, you gifted your niece a fraction of Bitcoin, or set up a savings plan in Ethereum for your nephew? A thoughtful, forward-looking gesture that celebrates tradition and introduces your loved ones to the digital economy. 'The UAE's proactive regulatory environment has positioned it as a global leader in digital finance,' said Nadeem Ladki, Global Head of Bitpanda Technology Solutions . 'Gifting digital assets this Eid not only honors tradition but also empowers recipients with a stake in the burgeoning digital economy. In fact, if you had gifted your loved ones 100 AED of BTC for Eid last year, it would now be worth 124 AED, reflecting a 24% growth overall, highlighting the potential of digital assets as a meaningful and forward-thinking gift.' This movement is backed by a strong foundation. The Dubai Financial Services Authority (DFSA) continues to expand its recognized crypto tokens list, and the Abu Dhabi Global Market (ADGM) has rolled out the world's first DLT Foundations Framework, enabling legal structures for blockchain-based organizations. On top of that, the Central Bank of the UAE recently approved AE Coin, the country's first dirham-pegged stablecoin, unlocking faster and more affordable digital transactions. The numbers speak for themselves. In 2024 alone, the UAE attracted over $30 billion in crypto investments, securing its spot among the top 10 countries globally for crypto adoption. The MENA region clinched 7.5% of the world's total crypto transaction volume, reflecting its fast-growing role in the global digital finance arena. Platforms like Bitpanda are making it easier than ever to explore this space. This Ramadan, why not turn a heartfelt gesture into a long-term opportunity? Start a crypto savings plan for a sibling, gift a slice of gold token to a parent, or help a cousin begin their investment journey. From Bitcoin to Ethereum—and even precious metals—there's a digital asset out there with their name on it. After all, what could be a more modern form of barakah than the gift of financial growth? This Eid, give the gift that could keep on giving. About Bitpanda: Bitpanda was founded in Vienna in 2014 and is the leading European crypto platform. With a selection of over 2,800 digital assets, including more than 500 crypto assets and numerous stocks*, ETFs*, precious metals and commodities, the Austrian fintech unicorn offers one of the most comprehensive ranges of digital assets available in Europe. Already trusted by over 5 million users, and dozens of institutional partners, Bitpanda holds licences in several countries, and has a proven track record of working with local regulators to keep assets safe and secure. This makes Bitpanda one of the safest and most strictly regulated trading platforms in the industry. In addition to its headquarters in Vienna, Bitpanda has offices in Amsterdam, Barcelona, Berlin and Bucharest.
