Investors in the UAE realised capital gains worth $204 million from their cryptocurrency investments last year, according to a new report by blockchain data company Chainalysis.
The global cryptocurrency investor community achieved total gains worth $37.6 billion in 2023, it said.
While this is much smaller than the $159.7 billion in gains made during the 2021 bull market, it represents a significant recovery from 2022, which recorded estimated losses of $127.1 billion, the report found.
With the crypto community in Saudi Arabia cashing out gains of $351 million, the UAE placed second in the GCC in terms of absolute gains realised by investors, Chainalysis said.
None of the other GCC countries ranked among the company’s list of top 50 countries globally.
Bitcoin was identified as the cryptocurrency of choice for UAE investors. This asset class accounted for 70 per cent of total gains made by UAE investors last year.
Ethereum was the second most popular cryptocurrency for UAE investors, delivering 24 per cent of the gains that the country’s investors realised.
XRP, the native token of the Ripple network, which placed third accounted for only 3 per cent of the gains on UAE investors’ deposits through 2023.
“The outsize popularity of Bitcoin and Ethereum indicates a level of maturity among UAE investors,” said Kim Grauer, director of research at Chainalysis.
“The community is clearly backing well-established digital assets with steady and proven performance, rather than backing more speculative cryptocurrencies. This isn’t surprising given that we have also observed that institutional investments by and large account for the greatest proportion of crypto transactions in the UAE.”
Bitcoin, the world’s largest cryptocurrency by market capitalisation, surged past $72,100 to reach a record high on March 11, driven by the UK’s financial services regulator opening the door to applications for crypto asset-backed exchange-traded notes (cETNs) to trade on the London Stock Exchange.
On March 5, Bitcoin hit $69,202, eclipsing its record of $68,991.85 set in November 2021.
The cryptocurrency was trading at $69,080.64 at 1.18pm UAE time on Saturday.
The recent cryptocurrency bull run has been fuelled by strong demand for US-listed spot Bitcoin ETFs, which the US Securities and Exchange Commission approved in January.
The approval marked a pivotal moment for the cryptocurrency sector, clearing the way for a regulated path for institutional and retail investor participation in the cryptocurrency asset class – and signalling the end of the sector's “Wild West” era.
The SEC approved 11 spot Bitcoin ETFs offered by major asset management companies including BlackRock, VanEck, Fidelity, Franklin Templeton and Cathie Wood’s ARC.
The expected Bitcoin halving next month, when the amount paid to miners is slashed in a programmed move every four years to reduce supply and maintain its scarcity value, is adding to the current rally.
“Over 90 per cent of Bitcoin’s total capped supply is already in circulation, and with the imminent halving, the daily addition of new Bitcoins will again halve,” said Matt Carstens, director of product experience at neo-broker amana.
“With markets already front-running and institutional money flooding in, coupled with the uncertainty of global debt, this halving promises to redefine crypto’s trajectory, albeit with potential sharp corrections along the way.”
Meanwhile, the Chainalysis report showed that cryptocurrency investors in India, the Philippines, Pakistan and Bangladesh collectively realised gains of $2.07 billion, placing sixth, 20th, 25th, and 49th respectively on the global top 50 list.
“While past performance shouldn’t be taken as indication of potential future outcomes, the outlook is encouraging,” Ms Grauer said.
“So far, the positive trends of 2023 have carried over into 2024, with notable crypto assets like Bitcoin achieving all-time highs in the wake of Bitcoin ETF approvals and increased institutional adoption.
“If these trends continue, we may see gains more in line with those we saw in 2021.”
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4pm: Al Bastakiya Listed US$300,000 (Dirt) 1,900m; Winner: Emblem Storm, Oisin Murphy (jockey), Satish Seemar (trainer).
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5.10pm: Nad Al Sheba Turf Group 3 $350,000 (Turf) 1,200m; Winner: Wildman Jack, Fernando Jara, Doug O’Neill.
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Women's Prize for Fiction shortlist
The Silence of the Girls by Pat Barker
My Sister, the Serial Killer by Oyinkan Braithwaite
Milkman by Anna Burns
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UAE tour of Zimbabwe
All matches in Bulawayo
Friday, Sept 26 – UAE won by 36 runs
Sunday, Sept 28 – Second ODI
Tuesday, Sept 30 – Third ODI
Thursday, Oct 2 – Fourth ODI
Sunday, Oct 5 – First T20I
Monday, Oct 6 – Second T20I
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The struggle is on for active managers
David Einhorn closed out 2018 with his biggest annual loss ever for the 22-year-old Greenlight Capital.
The firm’s main hedge fund fell 9 per cent in December, extending this year’s decline to 34 percent, according to an investor update viewed by Bloomberg.
Greenlight posted some of the industry’s best returns in its early years, but has stumbled since losing more than 20 per cent in 2015.
Other value-investing managers have also struggled, as a decade of historically low interest rates and the rise of passive investing and quant trading pushed growth stocks past their inexpensive brethren. Three Bays Capital and SPO Partners & Co., which sought to make wagers on undervalued stocks, closed in 2018. Mr Einhorn has repeatedly expressed his frustration with the poor performance this year, while remaining steadfast in his commitment to value investing.
Greenlight, which posted gains only in May and October, underperformed both the broader market and its peers in 2018. The S&P 500 Index dropped 4.4 per cent, including dividends, while the HFRX Global Hedge Fund Index, an early indicator of industry performance, fell 7 per cent through December. 28.
At the start of the year, Greenlight managed $6.3 billion in assets, according to a regulatory filing. By May, the firm was down to $5.5bn.
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GOLF’S RAHMBO
- 5 wins in 22 months as pro
- Three wins in past 10 starts
- 45 pro starts worldwide: 5 wins, 17 top 5s
- Ranked 551th in world on debut, now No 4 (was No 2 earlier this year)
- 5th player in last 30 years to win 3 European Tour and 2 PGA Tour titles before age 24 (Woods, Garcia, McIlroy, Spieth)
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PAST 10 BRITISH GRAND PRIX WINNERS
2016 - Lewis Hamilton (Mercedes-GP)
2015 - Lewis Hamilton (Mercedes-GP)
2014 - Lewis Hamilton (Mercedes-GP)
2013 - Nico Rosberg (Mercedes-GP)
2012 - Mark Webber (Red Bull Racing)
2011 - Fernando Alonso (Ferrari)
2010 - Mark Webber (Red Bull Racing)
2009 - Sebastian Vettel (Red Bull Racing)
2008 - Lewis Hamilton (McLaren)
2007 - Kimi Raikkonen (Ferrari)
Auron Mein Kahan Dum Tha
Starring: Ajay Devgn, Tabu, Shantanu Maheshwari, Jimmy Shergill, Saiee Manjrekar
Director: Neeraj Pandey
Rating: 2.5/5
ESSENTIALS
The flights
Etihad (etihad.com) flies from Abu Dhabi to Mykonos, with a flight change to its partner airline Olympic Air in Athens. Return flights cost from Dh4,105 per person, including taxes.
Where to stay
The modern-art-filled Ambassador hotel (myconianambassador.gr) is 15 minutes outside Mykonos Town on a hillside 500 metres from the Platis Gialos Beach, with a bus into town every 30 minutes (a taxi costs €15 [Dh66]). The Nammos and Scorpios beach clubs are a 10- to 20-minute walk (or water-taxi ride) away. All 70 rooms have a large balcony, many with a Jacuzzi, and of the 15 suites, five have a plunge pool. There’s also a private eight-bedroom villa. Double rooms cost from €240 (Dh1,063) including breakfast, out of season, and from €595 (Dh2,636) in July/August.
