Author: Zhao Ying
Source: Wall Street News
Crypto industry giants gathered in Abu Dhabi, urgently seeking capital injections to revitalize the sluggish market. As Bitcoin lost momentum since October and the industry faced an unexpected downturn, key figures from MicroStrategy founder Michael Saylor to Binance founder Changpeng Zhao appeared in the UAE capital, hoping to secure funding from deep-pocketed local investors.
According to a Wall Street Journal report on Sunday, during multiple meetings last week, crypto executives shuttled between venues—from the Bitcoin Middle East conference to "whale-only" beach club dinners and champagne parties on superyachts—actively seeking to engage with representatives of UAE sovereign wealth funds. It is reported that representatives of a UAE sovereign wealth fund managing $330 billion in assets were present at the venues.
The UAE's interest in cryptocurrency continues to grow. Binance recently received full approval from Abu Dhabi's financial regulator to operate a global trading platform from the emirate. A division of sovereign wealth fund Mubadala disclosed in November that it had tripled its Bitcoin investments, building a position worth approximately $518 million, while holding an additional $567 million Bitcoin position through ETFs.
Venture capital firm RockawayX, in a presentation, referred to the UAE as "the new Wall Street of digital finance." The company recently announced it would be acquired by an Abu Dhabi investor-backed firm. However, industry insiders caution that securing UAE funding typically requires years of relationship building and commitments to local operations, rather than "flying in to grab money and leave."
Industry Giants Bet on Middle Eastern Capital
Facing a market downturn, crypto industry leaders are pinning their hopes on UAE investors. MicroStrategy founder Michael Saylor stated at the Bitcoin Middle East conference that he has been pitching to "hundreds of investors" in the Gulf region—including sovereign wealth funds—on plans to accumulate more digital currency through various financial instruments. The company's stock has fallen by more than half since mid-year.
Saylor's presentation depicted MicroStrategy as a Bitcoin-powered space rocket aiming to achieve a "$20 trillion vision." The president of Japanese hotel operator-turned-Bitcoin hoarder Metaplanet said on stage that the company is seeking to raise funds through a new preferred stock plan called "MARS." The company's stock has also plummeted.
Other participants seeking opportunities include Dominari Holdings, the investment bank of choice for the Trump family, and the investment securities division of South Korea's Hanwha Group, which stated it plans to use Abu Dhabi as a regional hub for expanding into crypto products.
U.S. Policy Setbacks Drive Capital Outflow
The crypto market's downward trend has caught the industry off guard. Many participants had anticipated that Trump's full-throated support for the industry would drive accelerated adoption and unlimited gains. But while U.S. stocks remain near all-time highs, Bitcoin lost momentum in October, and a series of market liquidations battered traders and exchanges.
Trump's crypto legislative agenda also suffered setbacks, with some Democratic lawmakers putting the brakes on new bills to create a regulatory framework for digital currency markets. This policy uncertainty has further driven industry funds to seek opportunities abroad.
In contrast, the UAE's interest in cryptocurrency continues to grow. Earlier this year, a UAE state-backed investment company purchased $2 billion worth of shares in Binance, providing crucial funding support for the world's largest cryptocurrency exchange.
Abu Dhabi Builds a Crypto Financial Hub
The UAE is systematically positioning itself as a global cryptocurrency hub. The Abu Dhabi government is attracting crypto startups to set up operations in the city's financial center by offering early-stage financing, free office space, and other incentives.
Kristiina Lumeste, founder of Abu Dhabi venture capital firm Klumi Ventures, said: "The liquidity, decision-makers, and infrastructure are all here." The company is raising a $100 million crypto-specific fund from local investors.
At the Abu Dhabi Finance Week conference, executives from U.S. blue-chip crypto companies Coinbase and Circle mingled with Wall Street figures—including Bridgewater founder Ray Dalio and Blackstone CEO Steve Schwarzman—as well as representatives from traditional banking giants like UBS and HSBC. The Crown Prince of Abu Dhabi attended the opening ceremony, and senior executives from Mubadala and other sovereign wealth funds also participated.
Localized Operations Key to Investment
Despite the numerous opportunities, securing UAE funding is not easy. Basil Al Askari, co-founder of Mubadala-backed Abu Dhabi crypto brokerage MidChains, pointed out that many foreign companies new to the region hope to quickly strike deals and return home.
He observed that some make "rookie mistakes," assuming he works for a major UAE investment institution simply because he looks Emirati and wears traditional attire. Al Askari emphasized that, with few exceptions, persuading a sovereign wealth fund or large family office to invest typically requires years of relationship building and a commitment to developing business locally.
Samantha Bohbot, Chief Growth Officer of RockawayX, stated: "They are not looking for people who fly in, take the money, and leave. You must have a substantive stake and follow through." The company has established its headquarters and a local crypto project incubation center in the UAE, subsequently announcing it would be acquired by an Abu Dhabi investor-backed firm.
