Recent crypto market conditions have been a tale of two extremes: while Bitcoin has retreated more than 30% from its all-time high, the UAE is bustling with various crypto conferences, attracting top institutions and seasoned industry professionals.
It's hard to imagine that this region, which 'made its fortune' on oil, has now become a new hotspot for the crypto industry. Why is it attracting major leading institutions to gather here and even establish their headquarters?
Looking back to 2024, the UAE incorporated the crypto industry into its '2031 National Investment Strategy' and introduced the 'Tokenization Regulatory Sandbox Guide' in 2025, forming a layered regulatory model with federal and local coordination.
So far, the Dubai Virtual Asset Regulatory Authority (VARA) has issued licenses to 36 companies, while the Abu Dhabi Global Market has explicitly classified crypto assets as a regulated financial category, completely addressing the industry's pain point of 'regulatory uncertainty' and forming a stark contrast to the regulatory deadlock in some regions.
It is precisely this regulatory improvement that has attracted numerous institutions to set up shop. For instance, leading exchange OKX became the first global exchange in the UAE to receive a license to offer such products to retail users a year ago and established a branch here. Its local team has now grown to over 100 people.
OKX CEO Star has publicly stated, 'Dubai has now become a core pillar of our long-term global strategy,' a sentiment that likely resonates with many crypto institutions putting down roots in the UAE.
Beyond regulatory support, as an 'oil tycoon,' the UAE is no stranger to major acquisitions.
In March of this year, Abu Dhabi's MGX invested $2 billion in Binance, setting a record for the largest single investment in the crypto industry.
This year, the Abu Dhabi sovereign wealth fund Mubadala tripled its Bitcoin holdings, with its total ETF holdings exceeding $1 billion, while the Abu Dhabi Investment Council also holds over $500 million in Bitcoin ETFs.
Simultaneously, policy incentives have created a 'startup洼地 (lowland)'. Tax-wise, personal crypto gains are tax-free, and companies in free zones enjoy tax exemptions for up to 50 years. Talent-wise, investing 2 million dirhams in crypto gains or being a top blockchain talent can directly qualify one for a golden visa.
Abu Dhabi also offers free office space and streamlined registration processes. Companies can cover all their business needs with a comprehensive license, significantly improving operational efficiency.
2025 data shows that the number of blockchain company registrations in Dubai surged by 300% compared to the previous year, highlighting the attractiveness of these policies.
Notably, a recent new law in the UAE officially grants the digital dirham the same legal status as physical cash, confirming its ability to serve as 'legal tender for any payment,' which will resonate with the crypto ecosystem.
The digital dirham not only provides a compliant channel for cross-border settlements but can also interact with stablecoins and tokenized assets, strengthening the Middle East's voice in global digital finance.
It's hard to imagine that the UAE, built on the traditional industry of oil, is now re-engaging with the wave of the digital economy through crypto assets. As an old Wall Street saying goes, 'Money is the smartest; it flows to where the opportunity is.' Perhaps the UAE is showing us the way through its actions.
