The UAE, in the desert, is quietly rising to become a cryptocurrency oasis.
From cryptocurrency payments visible on the streets to the sovereign fund's direct participation, and the clear and transparent regulatory framework, the UAE has quickly risen to become a cryptocurrency hub connecting the East and West.
Especially in Abu Dhabi, with recent gatherings of cryptocurrency giants such as Binance, Tether, Circle, and Ripple, this bustling city is becoming a new cryptocurrency hub that the world is targeting.
With key licenses in hand, Binance has established its governance center in Abu Dhabi.
Abu Dhabi is rapidly rising as a compliance hub for the global cryptocurrency industry.
On December 8, just after the conclusion of the Dubai Blockchain Week, Binance announced significant progress, having obtained full regulatory authorization from the Abu Dhabi Global Market (ADGM) Financial Services Regulatory Authority (FSRA), becoming the first cryptocurrency centralized exchange (CEX) to acquire a global license under this framework. According to the new regulations, starting from January 5, 2026, Binance will split into three independently licensed entities covering the key businesses of exchanges, clearinghouses, and brokers.
In response to regulatory pressures, Binance previously adopted a no-headquarters strategy for a long time, seeking policy space in multiple countries. As the industry moves toward full compliance, Binance has begun actively seeking a physical base. Abu Dhabi is the most watched candidate, not only because co-CEO Richard Teng comes from the ADGM regulatory system and is familiar with the local environment, but also due to the important reason of close ties in capital.
In March of this year, Binance announced it received a $2 billion investment from Abu Dhabi investment firm MGX, marking its first acceptance of external institutional investment since its establishment. Given MGX's extraordinary relationship with the Abu Dhabi royal family and government, and the general perception that Binance's current valuation is low, this investment is seen as Binance's 'token of loyalty' to Abu Dhabi.
While Richard Teng did not clarify in an interview with (Fortune) whether Abu Dhabi would become Binance's global headquarters, he emphasized that regulators are more concerned about where Binance is being regulated and stated that ADGM will become the governance center for Binance's global platform.
Binance's actions themselves are sending a strong signal to the world that Abu Dhabi could become a new coordinate for global cryptocurrency compliance.
Cryptocurrency institutions are collectively pouring in
This trend is far from limited to Binance. An increasing number of cryptocurrency giants are collectively flooding into Abu Dhabi, expanding their ecological territory.
Similarly, on December 8, Tether announced that its stablecoin USDT obtained the qualification certification as a 'fiat-referenced token' granted by ADGM, meaning that transactions, custody, and other businesses related to USDT can be conducted compliantly within the regulatory framework. Additionally, the support network for USDT has also expanded to a broader on-chain ecosystem including Aptos, Celo, Cosmos, Near, TON, and TRON.
Another stablecoin giant, Circle, has also announced that it has successfully passed approval and is officially authorized to operate as a currency service provider within ADGM, with Dr. Saeeda Jaffar, Managing Director for the Middle East and Africa, aiming to accelerate the adoption of trusted digital dollar and on-chain payment solutions in the UAE and the Middle East and Africa markets.
Ripple has also accelerated its operations in the UAE this year. In May, Ripple announced it received the first blockchain payment license from the Dubai Financial Services Authority (DFSA) and reached cooperation with Zand Bank and Mamo in the UAE, along with the announcement that its acquired Ripple Prime would open a new office in Abu Dhabi. Recently, Ripple's stablecoin RLUSD received local regulatory approval for use in compliant payment and fund management services.
Moreover, cryptocurrency institutions/projects such as Bybit, Kraken, Animoca Brands, eToro, TON Foundation, Paxos, and Aptos are continuously advancing into Abu Dhabi and have successively obtained approval to conduct various cryptocurrency businesses locally.
From policy to the streets, the UAE embraces the cryptocurrency economy
The UAE's embrace of the cryptocurrency economy is not a momentary impulse but rather one of the important pieces in its post-oil era strategy.
In response to the long-term trend of declining global demand for fossil fuels, the UAE is proactively breaking away from reliance on a single resource, shifting its growth focus from traditional energy infrastructure to high technology and the digital economy. This strategy has already shown significant results, with the non-oil sector accounting for over 70% of the UAE's GDP.
Today, the UAE has quietly become one of the countries with the highest cryptocurrency penetration rates globally, shifting from mere investment speculation to practical scenarios such as payments and consumption, where cryptocurrency payments can be seen everywhere in daily life.
ApeX Protocol's latest research shows that 25.3% of the local population holds cryptocurrency, with the overall penetration rate increasing by over 210% in recent years. Chainalysis' latest (2025 Global Cryptocurrency Geographic Report) shows that between 2024 and 2025, the scale of cryptocurrency inflows into the UAE will exceed $56 billion, making it the second-largest cryptocurrency market in the MENA (Middle East and North Africa) region. This growth is primarily driven by institutional trading, with a year-on-year increase of 54.7%. Meanwhile, small and large retail transactions have also increased by 88.1% and 83.6%, respectively.
Among the seven emirates, Dubai and Abu Dhabi are the two major cryptocurrency bases of the UAE. Dubai has gained global recognition for its keen business acumen, with its fame even overshadowing the UAE itself, being the first to attract global institutional layouts; 70% of the world's top 500 companies have established regional headquarters here. As early as 2022, Dubai established the world's first independent regulatory agency specifically for virtual assets, VARA (Dubai Virtual Assets Regulatory Authority), which quickly attracted global cryptocurrency companies. Although the FTX crash raised questions about its initial licensing system, the VARA 2.0 upgrade has strengthened the regulatory framework.
Abu Dhabi is known for its stability, relying on stronger government backing and financial capacity, making it the preferred choice for institutions seeking long-term security. Additionally, Abu Dhabi, which contributes more than two-thirds of the national GDP and holds 94% of the oil reserves, carries the economic backbone of the UAE, needing to break away from the comfort zone of oil while possessing the 'cash capability' required for transformation.
In 2018, the Abu Dhabi Global Market (ADGM) introduced one of the world's earliest comprehensive cryptocurrency regulatory systems. ADGM has an independent court system that directly follows the Anglo-American legal system, ensuring that legal enforceability and regulatory transparency rank among the top globally. External evaluations describe it as 'more detailed than the EU's MiCA and more coherent than the US.'
Abu Dhabi's competitive advantage also stems from direct government involvement, propelling industry development with national credit and capital accelerators. For example, the UAE National Bank, wholly owned by the Dubai government, provides cryptocurrency services through its subsidiary banks; the Abu Dhabi sovereign wealth fund ADQ and other major institutions plan to cooperate in launching a Dirham stablecoin; the Royal Group, closely related to the ruling family of Abu Dhabi, has made Abu Dhabi one of the world's major sovereign holders of Bitcoin through a state-supported Bitcoin mining program; the Mubadala Investment Company, another sovereign wealth fund in Abu Dhabi, has allocated Bitcoin.
An excellent location connecting the East and West
If using Dubai or Abu Dhabi as the center, two-thirds of the global population can be reached within an 8-hour flight.
At the same time, controlling the Persian Gulf exit, and being close to the Strait of Hormuz, the UAE has become a must-pass point connecting the Asia-Pacific economic circle and the European economic circle. The GMT+4 time zone configuration allows local financial institutions to seamlessly connect the two major markets of Asia and Europe. For Western enterprises, it serves as a bridgehead into the Middle East; for Eastern enterprises, it is the preferred offshore headquarters with transparent laws and controllable risks.
The unique and irreplaceable geographical advantage has made the UAE a golden hub connecting the East and West, enhancing its attractiveness to the cryptocurrency industry.
More importantly, the UAE's cryptocurrency industry can mature rapidly in a short time due to its federal government and the parallel dual framework of the emirates, allowing for both uniformity in regulation and differentiated experimentation in practice. This governance approach is evidenced by some of this year's cryptocurrency policies, which clearly delineate the bottom line while providing space for experimentation. For example, the Dubai Financial Services Authority launched a regulatory sandbox for tokenization, opening up pathways for RWA testing for the first time; the latest Federal Decree No. 6 issued by the UAE includes DeFi, stablecoins, DEX, cross-chain bridges, and more into the central bank's regulatory framework. For the cryptocurrency industry, this means a clearer compliance path while still allowing space for innovation to grow upward.
It can be said that the rise of cryptocurrency in the UAE began with its geographical hub, matured through compliance systems, and flourished due to innovation strategies.
With the support of a strong sovereign wealth fund, a lenient tax system, abundant financial reserves, and a friendly business tax environment, the UAE has won the favor of global capital. According to data from Henley & Partners, in 2025 alone, about 9,800 millionaires will migrate to the UAE, making it the largest net inflow globally. Familiar figures in the crypto circle such as CZ and Pavel Durov are also based here.
Previously, Telegram founder Durov recommended on X that Dubai is the city he believes is most suitable for living, citing 'zero tax and pure ambition,' describing it as a dreamland for libertarians.
The recent Bitcoin MENA 2025 conference has also made Abu Dhabi the focus of the global cryptocurrency community. On the eve of the conference, giant billboards in Abu Dhabi prominently displayed the quote from Bitcoin advocate Michael Saylor, 'Bitcoin is digital energy, superior to all other properties,' which may also reflect the attitude that this city conveys to the outside world.
Currently, the narrative of cryptocurrency in the UAE is expanding from the desert to the global stage. As for whether the Middle East will embrace Bitcoin as Michael Saylor envisions, potentially becoming the 'Switzerland of the 21st century,' the UAE may respond with actions.
