Stance on Bitcoin and Other Cryptocurrencies in UAE
Buying of Bitcoin in UAE and its popularity is still increasing, amidst all the regulations, bans, fluctuations in the price. Buying of bitcoin is not only growing in UAE but is also gradually increasing across the countries. However, buying of cryptocurrencies varies from region to region.
While global attention is on countries like the USA, China and Russia, Middle East countries are showing a positive stance on cryptocurrency regulations except Iraq and Kuwait, which are still studying the advantage of blockchain technology. Recently the government of UAE has also shown a positive attitude on the cryptocurrency regulation draft presented by the Securities and Commodities Authority (SCA).
Is Buying Bitcoin Legal in UAE?
Buying of Bitcoin and other cryptocurrency in UAE is entirely alright and legal. UAE is also trying to be the first government on the blockchain globally by making the federal transactions through cryptocurrencies. This year we have seen UAE has formed many partnerships with many of the financial companies and also these companies have begun to get involved in the Initial Coin Offerings (ICO’s).
With the boom in the cryptocurrency, the Middle East has made buying of bitcoins quite easy. Buying bitcoin in UAE can be done in three simple steps – Creation of an account at a cryptocurrency exchange, the deposit of AED and placing an order to purchase Bitcoin.
Three Simple Steps to Buy Bitcoin in UAE:
1. Creation of an account at a cryptocurrency exchange:
Before creating an account on cryptocurrency exchange. It is essential to decide and choose the right cryptocurrency exchange. Here is a list of some of the cryptocurrency exchanges in UAE which allows to Buy Bitcoin with AED.
One of the leading cryptocurrency exchange platforms in the Middle East which allows you to buy, sell and trade the cryptocurrencies. BitOasis was founded in March 2015 by Ola Doudin. The maker and taker fee on BitOasis is costly. Maker fee is 0.25% upto 1000 AED, and taker fee is 0.50% upto 1000 AED. BitOasis offers purchase of bitcoin through market (wallet type) order or using an order book system.
Palmex is one of the newest exchange platform that was established in the year 2019, one of the first digital exchange in the Middle East and North Africa region (MENA) which has received approval from the regulatory sandbox licence as a part of the fintech development programme.
Mohammed Alsehli and Walid Messaoud founded the exchange. The taker is 0.40% upto 200,000 USD trading volume for Cryptocurrencies such as BTC, ETH and LTC. Maker fee is 0.25% for trading volume upto 200,000 USD
Bitbns is an Estonia based exchange, headquartered in India. Founded in 2017 by Buyhatke founders. The exchange allows users to buy Bitcoin and 11 other cryptocurrencies in AED using their P2P USDT model. The maker and taker fee is flat 0.25%, which is the cheapest among the other exchange in UAE.
CEX.IO is a USA based cryptocurrency exchange, headquartered in London. Before the exchange business, it was a Bitcoin cloud mining platform. Currently, It offers the trade-in eleven cryptocurrencies such as BTC, LTC, XRP and others. User in the UAE region can buy Bitcoin and other altcoins on this exchange using Credit or Debit card, Bank Transfer and ACH. The user in UAE will have to pay 2.99% fee for a transaction with Master and Visa cards.
Changelly is a Malta-based cryptocurrency exchange based in Prague. Customers can shift between coins without depositing the coins in the exchange. It also allows you to trade between the biggest cryptocurrency exchanges such as Binance, Bittrex and Poloniex. It is not a platform for the users who are looking to purchase Bitcoin or other cryptocurrencies for the first time.
2. Deposit AED in Exchange:
After creating the account, the next step is to deposit the AED on the exchange to buy Bitcoin in AED. Bitoasis, Bitbns and Palmex allows you to purchase bitcoin with AED directly. While CEX asks you to deposit AED to their respective bank account, gives your USD with 2.99% fee charged currency conversion.
Changelly is useful for users who are looking to convert the cryptocurrency which they hold but not for beginners.
3. Place an Order
The most critical and final step to get a bitcoin is to buy the bitcoin on these platforms. Bitcoin can be purchased using an open order book exchange or on a wallet based exchange.
BitOasis, Bitbns and Palmex are open order book trading platform. I.e. user on these platforms can see the buy and sell price of Bitcoin at respective price and volume. The user can then buy bitcoin in any unit they like to purchase, by placing an order.
An order is a combination unit of Bitcoin and price at which they are willing to buy. Once the user fills the above information, the order will be placed in the order book and will get executed when someone fills the order placed on the order book of the exchange. User will have to wait until the request is completed in these types of exchange.
While on CEX.io a user can purchase bitcoin immediately, but the price might be higher than the open order book exchanges.
Changelly is moreover like a currency swap platform than buying. I.e. suppose you have Ethereum and if you want to change the Ethereum against Bitcoin. It can be done quickly on Changelly.
Does the purchase of Bitcoin end the process? Is it safe to keep Bitcoin on Exchange?
No, the next step is to secure your Bitcoin. Check out our article on How to Secure bitcoin.
FAQ on How to Buy Bitcoin in UAE
1. Is Bitcoin Legal in UAE?
Yes, Bitcoin and other cryptocurrency is completely legal to buy, You can trade and store it as well. Check more about selling BTC.
2. Is KYC necessary to purchase BTC in UAE?
KYC is dependent on Exchange to Exchange. Most of the exchanges in UAE requires KYC of Customer buy Bitcoin.
3. Is Bitcoin a safe investment?
Bitcoin and altcoins are as volatile as stock in equity market. So if you are planning to invest in bitcoin, Please do a research on return report on bitcoin.