The National Bank of Bahrain (NBB) announced on Monday the launch of its first regulated Bitcoin-linked investment fund. The product, developed in partnership with digital asset company ARP Digital, is specifically designed for institutional investors in the GCC region, which includes Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the United Arab Emirates.
National Bank of Bahrain pioneers the first Bitcoin fund
The fund represents a milestone in the region’s financial landscape, as it is the first time that a national bank in the GCC has offered a Bitcoin-focused investment product. It aims to provide accredited investors with exposure to Bitcoin while ensuring capital protection. Investors will be able to benefit from Bitcoin’s performance, but “maximum at a pre-determined threshold, while enjoying 100 percent capital protection on the downside,” according to local media. a report.
In a statement, Hisham Al Kurdi, CEO of the Markets and Client Solutions Group at the National Bank of Bahrain, emphasized the innovative nature of the investment offerings. “We are proud to offer this bespoke regulated investment, which blends the attractiveness of exposure to digital assets with the security of capital protection. This product underscores our focus on providing our wealth management clients with innovative and secure ways to diversify their portfolios in an evolving investment landscape. This is a testament to Bank of Bahrain’s leadership.” “NBK continues to advance financial innovation in the region.”
The introduction of structured investment linked to Bitcoin is part of NBB’s broader strategy to expand its portfolio of wealth management products. This product is particularly targeted at risk-averse investors who seek exposure to the potential growth of Bitcoin without exposing their main capital to volatility.
The cooperation between the National Bank of Bahrain and ARP Digital is expected to redefine the regional market. Abdullah Kanoo, Co-Founder and Co-CEO of ARP Digital, said: “Our collaboration with National Bank of Bahrain is a game-changer in the regional market. Leveraging our expertise in digital assets and NBB’s extensive reach in the financial sector, we have created a product that offers exposure to Bitcoin within a highly secure framework. This regulated investment opens new doors for investors looking for a calculated approach to digital assets.
With Bitcoin volatility a major concern for many investors, the capital protected structure of this fund provides a new solution for clients looking to participate in the digital asset market without taking on excessive risk. Dalal Buhiji, Executive Director of Business Development for Financial Services at the Bahrain Economic Development Board, hailed the launch as a major achievement.
“The launch of this Bitcoin-linked structured investment is a prime example of the true potential of Bahrain’s strong financial services ecosystem, which provides an attractive and streamlined environment conducive to innovative solutions. “This initiative embodies a seamless fusion between traditional financial practices and innovative technology-based solutions,” Buhiji said. Blockchain, and we are proud to witness local institutions like National Bank of Bahrain leading the cutting-edge developments and diversification of the sector.”
In Bahrain, recent developments in Bitcoin and cryptocurrency regulation highlight the country’s proactive stance in promoting fintech innovation while ensuring investor protection. In September this year, Crypto.com obtained a Payment Service Provider (PSP) license from the Central Bank of Bahrain (CBB). This license enables the platform to offer e-money and prepaid crypto card services in Bahrain. In April 2022, Binance obtained a license to operate in the country.
Bahrain’s regulatory framework is also highly respected for its balance between innovation and regulatory compliance. Since 2019, the Central Bank of Bahrain has implemented comprehensive guidelines for crypto asset services, ensuring that companies operate transparently while adhering to anti-money laundering (AML) and counter-financing of terrorism (CFT) protocols.
At press time, Bitcoin was trading at $62,500.
Featured image created with DALL.E, a chart from TradingView.com