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Home / Features / The Rising Demand For Digital Assets And Its Impact In The UAE

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The Rising Demand For Digital Assets And Its Impact In The UAE

Often the west is seen as the capital for global technology that overshadows emerging regions like the MENA. However, the MENA region, especially the UAE, has recently progressed in digital innovation and cutting-edge technologies, raising the demand for digital assets.

The revised regulatory frameworks promoting the digital asset space also had a substantial impact in increasing the demand, awareness, and adoption of digital assets in the UAE. It is believed that when the right conditions are met to address the rising demand, initial mainstream adoption for digital assets could be reached within four years in the UAE.

The rising demand has induced an unforeseen yet growing urgency and emphasis for recognizing the region's progress of digital assets, impacting different elements of businesses and the way of doing them in the UAE.

Impacts Of The Surging Demand In The UAE

Financial services and real estate are two areas with the highest potential to be impacted by the rising demand. If you have observed the latest news from investors or a reliable investment company, you'll see many are promoting views on utilizing digital assets as a wealth management strategy that has attracted many residents in the UAE. As a result, most residents are also openly admitting their interest in learning and educating themselves more on the digital asset space for wealth management purposes.

Another significant impact of the rising demand for digital assets in the UAE is the creation of a new customer niche for businesses that has access to substantial financial resources, which acts as a new source of wealth for companies to sell their products and services to. The new niche has now raised a growing awareness and fear among those who resist or linger for too long before accepting this change and will likely lose a new yet crucial segment of the market, impacting the sustainability of businesses.

It is speculated that a new system will be introduced to facilitate citizens and partners to create new businesses based on the shared ledger technology. Real estate, banking, healthcare, urban planning, smart energy, fin-tech, transportation, digital commerce, and tourism are the industries expected to benefit from this introduction.

The rising demand has also resulted in many local businesses leveraging digital assets to further their sustainability agenda and advance ESG (Environmental Social and Governance) projects. Even if you take smart city initiatives such as Dubai's Sustainable City (the first net-zero energy development in the UAE) and other up-and-coming smart cities such as Dubai South and Desert Rose City, they utilize the blockchain and digital asset innovation to power their processes. Many leading companies in the UAE and the MENA region have also planned to lead innovative projects centered at this intersection of technology and sustainability.

The growing appetite for digital assets is also enhancing the existing financial infrastructure. It is creating new opportunities to consolidate UAE's position as a hub in areas like the secondary market for digital assets, capital market issuance, and digital asset custodial services.

The Future

We will see digital assets considered under the same viewpoint as physical assets like properties in the future. Already big companies like Tesla are purchasing billions in bitcoins to hold them as assets. Many lenders and estate agents in the UAE have started to accept high amounts of Bitcoin as an asset when paying a deposit and providing equity. This trend will grow into the next decade, where digital assets will become the mainstream currency of the internet.

If you require professional advice on your digital asset investment, reach out to AIX Investment Group. We will be happy to appoint one of our financial advisors to guide you through your financial independence journey.

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