Bahrain Launches First Bitcoin Investment Fund

The National Bank of Bahrain (NBB) has reached a significant milestone by officially launching the first Bitcoin investment fund. This initiative is designed to cater to institutional investors in the Gulf Cooperation Council, which includes Bahrain, Kuwait, Oman, Qatar, Saudi Arabia, and the United Arab Emirates (UAE).

The fund was created in close collaboration with digital asset firm ARP Digital. It provides investors with access to Bitcoin in a structure that offers:

Returns capped at a predefined threshold
100% capital protection in the event of a price drop

Collaboration image between NBB and ARP Digital

Abdullah Kanoo, co-founder of ARP Digital, shared his vision for the new product:

This investment structure opens new doors for investors seeking a more calculated approach to digital assets. Thanks to ARP Digital’s expertise and NBB’s extensive financial industry connections, this product offers exposure to Bitcoin within a safe and secure framework.

Bahrain is gradually becoming an attractive destination for digital asset businesses due to its continuous efforts to build an “innovation-friendly crypto and fintech ecosystem.” The country has successfully established a clear regulatory framework that balances consumer protection with the promotion of commercial opportunities.

In addition to Bahrain, the UAE has also made significant progress in refining its regulations. In 2023, the Dubai Virtual Assets Regulatory Authority (VARA) released comprehensive crypto regulations for Web3 companies, including four mandatory rulebooks and detailed regulations governing the operations of virtual asset service providers.

According to the latest report from Chainalysis, the Middle East and North Africa (MENA) region accounted for 7.5% of the global cryptocurrency transaction volume between July 2023 and June 2024, with total transaction value reaching $338.7 billion. Notably, institutional and professional investors played a leading role in these transactions.

Although the majority of on-chain transactions still occur through centralized exchanges, both the UAE and Saudi Arabia have shown a “strong interest” in decentralized platforms, indicating a promising future for the digital asset market in the region.