The largest bank in Dubai, Emirates NBD, has launched cryptocurrency trading services through its digital bank Liv (users can buy and sell cryptocurrencies in the Liv X app). This is not only a significant move in the Middle Eastern financial industry but also feels like dropping a 'compliance bomb' on the global cryptocurrency market.

Banks are directly involved, giving cryptocurrencies 'identity cards'?

In the past, banks' attitudes towards cryptocurrencies were like 'parents watching early romance,' both curious and fearful of the risks. However, the entry of Dubai's largest bank is tantamount to giving cryptocurrencies 'stamp of approval,' allowing ordinary users to buy and sell directly through the bank's app, significantly lowering the participation threshold.

Custody services are handled by Standard Chartered's subsidiary Zodia, ensuring full compliance and addressing users' concerns about 'exchange collapses.' This may encourage more traditional financial institutions to follow suit, as seen with the actions of Switzerland's PostFinance and Italian banks as signs of a trend.

Dubai is transforming into a 'cryptocurrency paradise,' skillfully utilizing a combination of policies.

The UAE announced back in 2024 that cryptocurrency trading would be exempt from value-added tax, legalized salary payments, and even allowed cafes to accept Bitcoin for coffee. The bank's entry is a continuation of these policy benefits.

Dubai has upgraded from a 'tax haven' to a 'cryptocurrency paradise,' attracting global enterprises and capital influx. For instance, exchanges like 'OJBK' have obtained licenses, and the World Trade Center has established a cryptocurrency regulatory zone, forming a complete industry chain.

This wave of actions feels like Dubai is signaling: 'Take your time, Wall Street; we can do finance in the desert too!'

Market response: Short-term frenzy, long-term stability?

Short-term: The bank's endorsement may trigger speculative sentiment, especially with Middle Eastern wealthy funds entering, potentially exacerbating price volatility (for example, 'Dubai concept coins' being hyped).

Long-term: Compliance will transition cryptocurrencies from the 'gray area' to the mainstream, attracting more institutional investors. For instance, bank custody services may drive demand for Bitcoin ETFs and other products.

If regulatory measures in other regions lag behind, it could create a 'policy arbitrage' bubble (for instance, project teams flocking to register in Dubai).

This move by Dubai banks feels like opening a 'VIP channel' for the cryptocurrency market — compliance, tax exemption, and bank-level security, directly pushing crypto assets from 'underground trading' into 'sunlit rooms.' While there may be bubbles in the short term, this is an important milestone for cryptocurrencies to become a mainstream asset class in the long term.