A beginners guide to getting started on Crypto in the UAE
Everything you wanted to know about crypto but were too distracted to ask…
There’s a strong chance that some of you out there have included ‘buy crypto’ on your 2022 vision board, but have literally no idea how to go about it. Perhaps you’ve found yourself wide awake at 3am staring at the ceiling, plagued by the idea that you’re missing out on the dip without really knowing, or caring enough to Google, what ‘the dip’ actually is.
You’re not alone. According to a survey conducted by Triple A in 2021, less than two per cent of individuals in the UAE own any crypto at all, that’s half the global average. And whilst that number is growing, it also means that you haven’t missed the early adopter boat. It’s still at the virtual dock in fact, furiously blasting the foghorn, with plenty of cabin space and a sizeable berth on the poop coin deck.
Isn’t it super complicated?
Eh, kinda, but not necessarily. One of the main perception barriers to getting involved is that, at a casual glance, it can all seem a bit nebulous. We sympathise. Five minutes into any explanation about what ‘the Blockchain is’ — and we’re ready to start flipping tables. Of course it’s great to have a grasp on the basic terminology, but being able to hold a TEDTalk on the nuances of peer-to-peer ledgers is absolutely not a prerequisite for basic, foot-in-the-door investing.
We promise if you can make it to the bottom of the page without destroying the digital device you’re reading it on, you’ll be ready to make your first paddle in the crypto pool. And we’re absolutely not getting on to the subject of NFTs here, that dear reader, is a story for another day.
To do almost anything in the crypto world, you’ll need a virtual wallet of some kind. That’s where you’re going to store your cryptocurrency. There are several different types of wallet (none of which come LV branded, which we acknowledge is off-brand for Dubai) available to you, but for those starting out — it’s worth noting that most crypto exchanges offer wallets as part of their trading platform.
These exchanges are places where you can swap real world currencies (Fiat) for cryptocurrencies or, once you have amassed those stacks of e-cheddar, trade one type of crypto coin for another. These trading platforms are live and feature up-to-the-moment prices for each coin (with their current value displayed against a range of Fiat currencies (like USD or AED for example).
The apex crypto currency is Bitcoin (BTC), all others coins, including the headline snatching Ethereum (ETH), are known as ‘altcoins’. These (altcoins) digital drip tokens are the wild west of cryptocurrency, fortunes are won and lost here through activities like shorting and speculative hedging, but (with the exception of Ethereum) unless you’ve really done your research we’d recommend newbies steer clear of dropping any serious cash on them.
Don’t set your initial sights on making trips ‘to the moon’. With the inevitable arrival of the Metaverse, it’s enough to just own ‘some’ crypto.
Opening your account
So, orientation over, you’re now ready to treat yourself to some crypto. The easiest way-in that we’ve discovered so far, for those based in the UAE, is with CoinMENA. It’s a Middle East-based company that’s fully licensed by the Central Bank of Bahrain and has recently signed a deal with DWTC to establish a crypto hub in Dubai. It’s available on most smart devices via a handy app that lets you transfer money in AED directly from your bank account and exchange it (with a small transactional fee) for BTC or a small collection of other altcoins (including ETH).
The account set up is not instantaneous. To help preserve the integrity of the crypto market, the service operators need to make sure you are who you say you are, to protect you from fraud and so that there’s an audit trail just in case you’re planning any sort of grand crypto heist. You’ll need to upload a few documents, including the front page of a bank statement, a utility bill and ID. Verification takes at most a couple of days, then you’re free to start collecting coins like the Super Mario you were clearly born to be.
But remember, the golden rule of any speculative investment, is to never put down more than you can afford to lose. Whether that’s Dhs5 or 5 Bitcoins (currently around Dhs136,068). You will not become the wolf of Al Khail street overnight, crypto markets are volatile and there’s every chance you’ll take some knocks on your investment journey. But if you’re prepared to stay in it for the long HODL, it certainly doesn’t look like crypto is going to be a passing fad. Unlike Pokemon GO. RIP sweet prince.
To help you start your investment adventure on the best, most informed foot, we spoke to an expert. Zeid Bataineh, the Content Marketing Director of CoinMENA, has been kind enough to give us his top five novice tips for investing in crypto.
- Use a regulated exchange (Like CoinMENA): This is very important because with a regulated exchange you can deposit in your local currency and withdraw your money to your local bank account anytime. With unlicensed international exchanges, you can only deposit your money, but can’t withdraw!
- Start small: Only invest what you can afford. Start with a small allocation to have “skin in the game” and start paying attention and learn. The best way to learn about something is to participate in it!
- Think long term: The best investors in the world think in years, not days or months. Warren Buffet once said “Do not take yearly results too seriously. Instead, focus on four or five-year averages.”
- Do your homework: There are established cryptocurrencies like Bitcoin and Ethereum, and there’s “meme coins” like Doge and Shiba. They are not the same. While you are at it, google what “Dollar Cost Averaging” means.
- Be patient, not greedy: “Rome wasn’t built in a day” Cryptocurrency gains can be exciting, but the volatility works both ways.
In the best interests of you, the consumer, we’re obliged to tell you that there are other regionally-based exchanges that you can get involved with, all we can do is give you feedback on what has worked for us. CoinMENA has been easy to use, as safe as crypto trading can be, and the best way we’ve found to open account for the impending world of the Metaverse. Whether you’re ready for it or not, it’s coming…