UAE expats send money in crypto – Sat, Jun 10 2023

Mohammad Bilal had to wait his turn outside a money transfer office in the sweltering Dubai heat, sending US$1,000 home to his wife and parents in Pakistan at a cost of about $7 per transfer each month.

He switched to an app that allows him to send money instantly without transaction fees, joining the ranks of expats in the UAE using cryptocurrencies and blockchain services to send money quickly and cheaply.

„Now, I don’t need to wait in line,” said Bilal, a 27-year-old customer service agent.

„I do it at home from my mobile phone and the money is sent in seconds.”

The Middle East and North Africa had the fastest-growing crypto market in the world last year, with crypto exchanges in the region growing 48 percent to $566 billion in the year to June, according to blockchain data platform Chainalysis.

The use of crypto for remittance and storage and increasingly permissive regulations are helping drive growth in the region, it added.

The United Arab Emirates plans to make Dubai „the first city entirely powered by blockchain,” and it has developed laws and regulatory systems around digital assets to become a hub for the crypto industry.

Anti Arponen, CEO of Pyypl, a Dubai-based fintech company, said 5 million people have downloaded the app since its launch in 2017.

„Eighty percent of our users are immigrants and the number has been growing exponentially in the last few years,” he told the Thomson Reuters Foundation.

Migrant workers have said crypto offers a better deal than traditional banking and money transfer services, with many holders of digital currencies suffering huge losses in the market’s collapse last year.

„With crypto, there are almost zero fees – easy, instant and secure,” said Gerard Dingle, a 30-year-old pastry chef who has been using crypto and Bible to send money to his mother and sister in the Philippines.

But such sites leave users vulnerable to scams and highly volatile currencies, said Pete Howson, a crypto expert and assistant professor of international development at Northumbria University in the British city of Newcastle.

„Users’ funds are not insured when they use these types of platforms [crypto and blockchain-based apps]”Like they are with a bank,” he said.

Immigrants are looking for value

Almost 90 percent of the UAE’s 9.3 million people are expatriates, according to a UN Capital Development Fund report last year, including many from India, Pakistan, Bangladesh, Indonesia and Egypt.

They account for billions of dollars in remittances to their home countries, but most are manual laborers who do not earn the minimum monthly income of 5,000 dirhams ($1,350) required to open a bank account in the UAE.

Migrants often use money transfer services because they are cheaper, said Mohammad Jalal Uddin Chiktor, a labor migration researcher and coordinator of the Center for Migration Studies in Bangladesh.