Cryptocurrency firm Phoenix Group has launched its debut on the Abu Dhabi market, the first of its kind in the region.
The debut of the firm, which saw its shares surge by 35% on its first day of trading, to $3.3 billion, alongside a rally a bitcoin, highlights the growing interest in cryptocurrencies in the region, Bloomberg reported on Tuesday (Dec. 5)
The IPO for Phoenix drew orders worth $12 billion, making it 33 times oversubscribed, the report said, pointing to growing demand for crypto in the area. The success of this listing could potentially encourage other crypto-related companies to go public in the United Arab Emirates (UAE), Bloomberg said.
The UAE has been positioning itself as a hub for the crypto industry, but it has also been increasing scrutiny to ensure proper oversight and compliance. The country aims to be removed from global watchdog’s Financial Action Task Force’s “gray list” and has taken steps to tighten regulations, per the report. In line with this, Dubai’s crypto regulator recently fined 18 firms for compliance breaches.
The rise in demand for cryptocurrency is also driving bitcoin prices upward.
Bitcoin recently surpassed $42,000, driven by optimism surrounding the potential approval of the first spot exchange-traded funds in the United States and hopes of a regulatory crackdown easing, Bloomberg said.
It’s the first time the cryptocurrency has passed this price in 20 months, since the collapse of Terra in April 2022, PYMNTS reported on Monday (Dec. 4).
“The market is increasingly expecting a rate cut in the coming year, and investors are increasingly bullish on the outlook of Bitcoin ETF applications by some of the biggest names in asset management,” Metalpha senior analyst Lucy Hu wrote, per the report. “This is an official statement of a bull run, and the price could see more upticks in the coming weeks.”
However, a recent JPMorgan report was skeptical of the bullish outlook, noting that investors may back the Bitcoin ETF instead of the cryptocurrency itself.
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