Following the world’s media coverage of Dubai’s new crypto laws announced in March, traditional businesses and institutions, such as shops, schools, and delivery services, in the UAE are promptly embracing digital currencies. Arab News released a panoramic report on how businesses in Dubai gradually adopt payments and salaries in crypto.
After the several global crypto exchanges bagged commercial licenses and moved headquarters to Dubai, a broad set of local businesses have opened their doors to people willing to lighten their crypto wallets.
Bake N More, a coffee and pastry shop in Al-Quoz, became the first cafe in Dubai to accept crypto from its visitors, including Bitcoin, Ethereum, and Tether.
“There’s been tremendous interest in cryptos because people see this as the future payment gateway system, especially those who have held on to them for a long time and are now looking to cash them,” says Mohammad Al-Hammadi, Bake N More’s owner.
The payments are handled by Mixin Network, a fast and decentralized platform that facilitates the transfer of digital assets. It charges customers by converting the cost of an item into its value in cryptocurrency. For example, if a bottle of water costs 5 dirhams ($1.36), the price payable in TerraUSD stablecoin, would be about 1.36UST as it is pegged 1:1 against the US dollar.
Meanwhile, Citizens School, the UK-curriculum non-selective school situated in the rich Al-Satwa district, will let parents pay the tuition fees in Bitcoin and Ethereum since September.
“The reason we are accepting crypto payments is to start a conversation among parents and children about the technology that will influence the lives of the young generations,” says Hisham Hodroge, Citizens School CEO, adding that nearly 10% of the parents opted to pay in crypto.
Adil Alzarooni, a founder of Citizens School, said in a statement:
“A while ago, cryptocurrency was only a floating term among well-versed investors. However, today cryptocurrency is becoming much more mainstream, reshaping the traditional financial system.”
Dubai-based online convenience store Yalla Market, which delivers groceries, now accepts USD Coin and Tether. Besides launching a new payment method for its customers, the startup is also considering paying salaries via digital assets soon.
“We can now see that the world is increasingly adopting blockchain and cryptocurrency technologies,” states Leo Dovbenko, Yalla Market CEO and co-founder. “We could not stand aside as a company based in the UAE.”
According to blockchain data platform Chainalysis, the UAE is estimated to be the third-largest crypto market in the Middle East after Turkey and Lebanon and totaled a transaction value of $26 billion between July 2020 and June 2021.
Early this year, the UAE announced a licensing program following the example of rival financial centers like Singapore and Hong Kong. In March, the state passed its first crypto law and established a regulatory body to oversee virtual assets.
The government set up the Dubai Virtual Assets Regulatory Authority (VARA) to oversee the regulation, governance and licensing of cryptocurrencies, NFTs, and other virtual assets. The decision led to a massive inflow of global crypto businesses in the Gulf.
Global crypto giants like Binance and FTX received licenses to operate in the city, while crypto exchange Bybit announced its plans to move its headquarters from Singapore to Dubai. Meantime, Crypto.com has revealed its intention to set up its regional office in the city.
Emma McInnes, global sector head of financial services at YouGov, a UK-based market research and data analytics firm, notes:
“Countries like the UAE have already created governing bodies to measure and promote the growth of virtual assets. It’s keeping itself ahead of most of the world in developing the crypto market.”
YouGov recently released a report titled “The Future of Financial Services” based on a sample size of 1,012 in the UAE. The study revealed that 67% of UAE residents were interested in investing in cryptocurrencies within the next five years, and 21% intended to trade in the next 12 months.
Meanwhile, Talal Tabbaa, CEO of CoinMENA, a digital assets exchange licensed by the Central Bank of Bahrain, predicts:
“Like all businesses started using the Internet 20 years ago, they will start using crypto now; it is inevitable.”
The message is clear: crypto is here to stay, while the crypto ecosystem in the UAE is set for bigger things.