Cryptocurrency is a virtual or digital currency that uses cryptography to secure its transactions and control the creation of new units. Crypto assets are decentralized, so they are not subject to the control of financial institutions or governments. The first cryptocurrency, Bitcoin, was created in 2009.
For years now, cryptocurrency has been traded on unregulated digital exchanges. This has made it difficult for people in some countries, like the UAE, to buy cryptocurrency.
In February 2018, however, the Abu Dhabi Global Market (ADGM), one of the world’s leading financial centers, announced that it would be launching a regulated cryptocurrency exchange. This move is sure to make it easier for people in the UAE to invest in cryptocurrency.
The framework is intended to handle the complete spectrum of risks connected with crypto assets, including money laundering and financial fraud, consumer protection, technological governance, custody, and exchange operations. This new structure is one of ADGM’s numerous initiatives and continuous commitments to help Abu Dhabi diversify its economy via innovation and sustainability projects.
The public consultation received overwhelmingly positive feedback, with local and international respondents praising the proposed regulatory framework’s comprehensiveness. Several adjustments to the regulatory system have been implemented in response to constructive feedback from these respondents, with one major change being the establishment of a sliding scale Daily Value Trading Levy on Crypto Asset Exchanges.
Apart from this, many trading platforms in the UAE already allow you to buy cryptocurrency. eToro, Kraken, and BitOasis are just a few of the many platforms that allow you to buy Bitcoin, Ethereum, and other cryptocurrencies.
When it buying cryptocurrency, it’s crucial to remember that it is still an unregulated market. This means that there is a high risk of fraud and price manipulation.
While their popularity is increasing, cryptocurrency is still a relatively new concept for many people. If you’re interested in buying cryptocurrency in the United Arab Emirates (UAE), here’s what you need to know.
Ways To Buy Cryptocurrency In UAE
If you are interested in purchasing cryptocurrency in the UAE, there are a few different ways to do so. But be sure to do your own research before investing any money.
One way to invest in cryptocurrency in the UAE is through a local exchange. These exchanges are regulated by the ADGM, which offers increased protection against fraud and price manipulation.
When using a local exchange, you will need to go through a know-your-customer (KYC) process to verify your identity. Once you have been verified, you can link your bank account or credit card to the exchange and start buying cryptocurrency.
Another way to buy cryptocurrency in the UAE is through international exchange. These platforms are not regulated by the ADGM but may offer lower fees. However, carefully research any international exchange before using it, as there is a higher risk of fraud and price manipulation.
You can also buy cryptocurrency directly from another person. This is often done through online forums or social media platforms. Be careful before meeting up with someone to buy cryptocurrency, as there is a risk of fraud or theft.
Finally, you can mine cryptocurrency yourself. Crypto mining involves using computers to solve complex math problems to verify transactions on the blockchain. While this method can be convenient depending on your resources, it can be very expensive and time-consuming.
Again, make sure to do your own research before buying cryptocurrency in the UAE. This is an unregulated market, and there is a high risk of fraud or theft. So do your due diligence and carefully consider all your options before investing any money.
The most important thing to remember is that you should never invest more than you can afford to lose. The price of cryptocurrencies fluctuates rapidly and is extremely volatile. Therefore, invest only according to your risk appetite and closely monitor the market to avoid losses.
ADGM Regulatory Framework
The Abu Dhabi Global Market (ADGM) has announced a new regulatory framework for cryptocurrency activities in the ADGM. The framework is designed to handle the complete spectrum of risks connected with crypto assets, including money laundering and financial fraud, consumer protection, technological risks, and market manipulation.
The new framework requires businesses that want to operate in the space to obtain a license from the ADGM. This licensing process will be conducted by the Financial Services Regulatory Authority (FSRA), which will also oversee the ongoing regulation of these businesses.
In addition to the licensing requirement, businesses will also need to comply with other regulations, including anti-money laundering (AML) and countering-the-financing-of-terrorism (CFT) rules. Businesses will also be required to implement know-your-customer (KYC) procedures.
The ADGM has also announced a new Daily Value Trading Levy on Crypto Asset Exchanges. The levy is a sliding scale tax based on the value of each trade and is designed to discourage speculative trading.
The ADGM’s new regulatory framework is a positive step for the cryptocurrency industry in the UAE. The framework provides increased protection for investors and should help to foster more innovation in the space.
Why Buy Cryptocurrency In UAE?
Aside from its popularity, there are a lot of reasons to buy and invest in cryptocurrency in the UAE.
- Decentralized: One major advantage of cryptocurrency is that it is decentralized. Decentralization implies that there is no central authority controlling the currency. Instead, it is controlled by a network of computers around the world. This decentralization provides increased security against fraud and theft.
- Low Fees: Another advantage of cryptocurrency is that it often has low fees. When you buy or sell cryptocurrency, you will only be charged a small fee for the transaction. This fee is usually much lower than what you would pay with traditional methods like credit cards or wire transfers.
- Fast Transactions: Cryptocurrency transactions are also very fast. They are typically processed within a few minutes, which is much faster than traditional methods like bank transfers.
- Anonymous: Cryptocurrency is often seen as an anonymous way to transact. This is because you do not need to provide your personal information when buying or selling cryptocurrency.
- Liquidity: Cryptocurrency is also very liquid. This means that you can easily buy or sell it on exchanges without having to worry about finding a buyer or seller.
- Borderless: Cryptocurrency is also borderless. You can send and receive cryptocurrency without exchanging it for another currency.
- Increasing Adoption: Cryptocurrency is becoming more and more popular each day. This increasing popularity is leading to more businesses and individuals accepting it as a form of payment.
- Innovative Technology: Cryptocurrency is based on innovative blockchain technology, which has the potential to revolutionize many different industries.
- Hedge Against Inflation: Cryptocurrency can also be used as a hedge against inflation. Since the supply of most cryptocurrencies is limited, their value could potentially increase if inflation increases.
- Earn Interest: Some cryptocurrencies allow you to earn interest on your investment. This is possible because some cryptocurrencies are deflationary, which means their supply decreases over time.
These are just some of the reasons why you should invest in cryptocurrency in the UAE. There are many other reasons not mentioned here. However, these ten reasons should give you a good idea of the benefits of buying cryptocurrency.
Payment Methods For Buying Cryptocurrency In UAE
There are a few different payment methods that you can use to buy cryptocurrency in UAE.
- Credit Cards: One popular payment method is credit cards. You can use your credit card to buy cryptocurrency on exchanges like Coinbase and Gemini. However, please note that some credit card companies may classify these purchases as cash advances, which could result in higher fees.
- Debit Cards: Debit cards are also a popular payment method for buying cryptocurrency. You can use your debit card to buy cryptocurrency on exchanges like Kraken and Bitstamp.
- Wire Transfer: Wire transfer is another popular payment method for buying cryptocurrency. You can use your bank account to send a wire transfer to an exchange like BTC Markets.
- Crypto Wallets: Crypto wallets are a type of software that allows you to store, send, and receive cryptocurrency. Some popular crypto wallets include MetaMask, Exodus, and Trust Wallet.
- Payment Processors: Payment processors like PayPal and Skrill can also be used to buy cryptocurrency. However, not all exchanges accept these payment methods.
These are just some of the most popular payment methods for buying cryptocurrency in the UAE. There are many other payment methods available as well. However, these five methods are the most commonly used.
How To Buy – Step By Step
If you want to buy crypto from a trading platform, here’s a general guide to what you need to do:
- Create an account on the exchange. You will need to provide your personal information, such as your name and email address.
- Verify your identity. Most exchanges will require you to undergo verification before you can buy cryptocurrency. This is typically done by uploading a copy of your ID.
- Deposit funds into your account. You will need to deposit fiat currency, such as AED, into your account before you can buy cryptocurrency.
- Once you have deposited funds into your account, you can start buying cryptocurrency.
- After you have bought cryptocurrency, you can withdraw it to a crypto wallet or keep it on the exchange.
Note: The exact steps may vary depending on the exchange you are using.
When buying cryptocurrency, you will need to pay fees. These fees can be divided into two categories: trading fees and withdrawal fees.
- Trading Fees: Trading fees are charged by the exchange when you buy or sell cryptocurrency. These fees are typically a percentage of the total trade value.
- Withdrawal Fees: Withdrawal fees are charged by the exchange when you withdraw cryptocurrency to a wallet or another exchange. These fees are typically a fixed amount or a percentage of the total withdrawal amount.
Note: Some exchanges do not charge withdrawal fees. However, they may charge higher trading fees to make up for this.
Where To Buy Cryptocurrency in the UAE
eToro is the leading crypto exchange in the UAE for several reasons.
Trading digital currencies necessitate safeguarding your dollars and valuables. Top financial regulators FCA, ASIC, and CySEC have approved and regulated this eToro. Therefore, residents of the UAE might consider it a safe platform. With just $25 (about 92 AED), you can enter the world of cryptocurrency.
When you use this broker to do a transaction, such as buying Bitcoin, you will only be charged a spread. The gap starts at just 0.75 percent, making investing in Bitcoin extremely competitive. However, purchasing cryptocurrencies might be scary for newcomers due to their incapacity to safeguard them properly.
To ensure eToro’s security, your tokens can be purchased, sold, exchanged, and kept on the site itself. If you wish to cash out your investment, you should construct a sell order rather than making many transfers between wallets or third-party exchanges.
- Social Trading – eToro’s platform is designed to make it easy for you to copy the trades of other successful traders.
- Low Fees – eToro charges low fees for both crypto trading and withdrawing your funds.
- Regulated – eToro is a regulated exchange, which adds an extra layer of security for users.
- Variety of Payment Methods – eToro offers a variety of payment methods, including bank transfer, credit/debit card, and PayPal.
- Beginner Friendly – eToro’s platform is user-friendly and ideal for beginners who are new to crypto trading.
- Trading Fee: Spread, 0.75% for Bitcoin
- Withdrawal Fee: $5
Coinbase, another leader in the cryptocurrency space, is based in the US and has been operational since 2012. The exchange enables you to buy and sell a variety of cryptocurrencies, such as Bitcoin, Ethereum, Litecoin, and more.
Coinbase also offers a crypto wallet service. This allows you to store your cryptocurrency offline in a secure location.
In addition, Coinbase is one of the few exchanges that offer insurance for your cryptocurrency. So if your account is hacked or if Coinbase loses your cryptocurrency, you will be compensated by the exchange.
- Insurance – Coinbase offers insurance, which means that you will be compensated if your account is compromised or if Coinbase loses your crypto assets.
- Beginner Friendly – Coinbase has a user-friendly platform ideal for beginners.
- Variety of Payment Methods – Coinbase offers a variety of payment methods, including bank transfers, credit/debit cards, and PayPal.
- Security – Coinbase takes security seriously and stores 98% of customer funds offline in cold storage.
- Trading Fee: Commission, starting from 0.50%
- Withdrawal Fee: 1.49% to a U.S. bank account
Binance, a leading cryptocurrency and Bitcoin exchange in the UAE, has over 100 million users. There are hundreds of traded cryptocurrencies on this exchange, making it an ideal alternative for individuals wishing to diversify their cryptocurrency portfolio.
The minimum order size is merely 0.0001 BTC. If you are not confident in your ability to handle your storage and security procedures, the platform will retain the majority of your cash in cold storage.
The platform offers more than 500 tokens to trade, from well-known ones to new and upcoming projects. So it’s always better to do your research when investing in new coins or altcoins.
Binance is the most accurate site for analyzing crypto quotes in your local currency and tracking the success of your portfolio. The platform will display the crypto rates if you use AED as your default currency. As a result, you shouldn’t have to convert your money or use a separate calculator to calculate your profits and losses.
The trading fee ranges from 0.1% to 0.01%, based on the trading volume over the past 30 days. You can also reduce your fees by 50% if you use Binance Coin (BNB) to pay your trading fees.
- Low Trading Fees – Binance has some of the lowest trading fees in the industry, ranging from 0.1% to 0.01%.
- Variety of Cryptocurrencies – Binance offers over 500 cryptocurrencies, including well-known and up-and-coming projects.
- Cold Storage – Binance stores the majority of its customer’s funds in cold storage, protecting assets from hackers.
- Leverage Trading – Binance offers leverage trading, which allows you to trade with more money than you have in your account.
- Trading Fee: 0.1% to 0.01%, depending on trading volume
- Withdrawal fee: 0.80 EUR (SEPA bank transfer)
Coinmama, founded in 2013, provides easy and convenient solutions to acquire and trade cryptocurrencies. Since its inception, Coinmama has been utilized by over 2,800,000 people in 190 countries. Coinmama is now available to individuals who want to buy Bitcoin and eight other altcoins, including ETH, XRP, and LTE.
As an added benefit, you can trade Bitcoin for a variety of fiat currencies, including USD, British pounds, and CAD, at this Dubai crypto exchange. Coinmama also accepts a range of payment options, including credit and debit card transactions.
- Easy to Use – Coinmama has a user-friendly platform that is ideal for beginners.
- Fast Transactions – Coinmama processes transactions quickly, so you can receive your cryptocurrency within minutes.
- Global Support – Coinmama is available in 190 countries around the world.
- Zero Withdrawal Fee – There are no withdrawal fees when you use Coinmama.
- Trading Fee: 3.90% Commission
- Withdrawal: Free
Founded in 2011, Kraken is a cryptocurrency exchange that allows you to buy, sell, and trade a variety of cryptocurrencies. The exchange offers a wide range of fiat currencies, including USD, EUR, CAD, JPY, and GBP. You can also trade cryptocurrencies against each other on Kraken. For example, you can trade Bitcoin for Ethereum or Litecoin.
Kraken lets you trade with a high degree of liquidity. The exchange also offers margin trading, which allows you to trade with more money than you have in your account.
- Margin Trading – Kraken offers margin trading, so you can trade with more funds than you have in your account.
- High Liquidity – Kraken has a high degree of liquidity so that you can buy and sell cryptocurrencies quickly.
- Fiat Currencies – Kraken supports a variety of fiat currencies, including USD, EUR, CAD, JPY, and GBP.
- Cryptocurrency Selection – Kraken offers a wide selection of cryptocurrencies, including Bitcoin, Ethereum, Litecoin, and Monero.
- Trading Fee: 0.16% to 0.26%, depending on trading volume
- Withdrawal fee: 0.02% fee