Coinbase Bets on the UAE as Regional Demand Grows for Crypto, Payments and Digital Assets

Coinbase, the world's largest crypto platform, is here with us, and they're bitten big on the UAE.

With me in the studio, Coinbase Institutional Co-CEO Brett Tejpaul and Head of Strategy John D'Agostino.

Thank you and thank you for joining us today and for being here with us.

Brett, in simple terms now, um, why is the UAE such a big deal now for Coinbase?

Well, um, this is my 23rd year of coming here.

I started my first trip in 2003.

And I've probably been one of the largest and loudest voices at Coinbase for making the UAE our strategic hub internationally.

Um, as you know, we bought Darabit last year, which was a super big deal, and, um, we're, we have ambitious plans to do a lot more here.

So, uh, we, we view UAE as the hub for international for us, so.

Yeah, we'll talk about there a bit more after, but why do you think the UAE is the hub now, and you called it the midpoint, I think, between Wall Street and MIA.

Well, the UAE has been in a leadership role of doing all things new and different and innovative, and I remember actually quite vividly a few years ago where I went to Crypto Finance Week and ADGM Finance Week, and we had a giant announcement of the UAE being the hub for a global crypto that came at a time where the US was a little frosty.

Uh, on, on the industry, and since then they've kept to the plan and all of you have delivered in fantastic form.

So we've been able to do things like regulatory sandboxes to launch new initiatives.

We've grown Dare a bit here and now we're integrating everything, so it's super excited.

So Jean, when you were with us back in March and FinTech TV, you talked about the UAE also, and you said that it would come out stronger after all this turbulence.

Three months later, what has really changed on the ground?

So I think that prediction is coming true.

Uh, when Brett first hired me 5 years ago, we talked about where you need to be in the world to be a global company.

Um, as a US business, you need to have an entity in the US.

You need to cover Europe.

Uh, you need what we call an offshore territory like Bermuda, uh, and you need the UAE.

And if you have that footprint, you are a global business.

You can paper to anyone in the world.

That thesis was right 5 years ago.

That thesis is right today.

Um, cities like New York, London, Tokyo, they've survived these types of troubles and greater, and they've survived stronger.

So the fact that we're here today, I think is testament to that.

Yeah, so Dubai or UAE is like the window to the whole region or to the Middle East and North Africa as well for a Coinbase at the moment.

So, Brett, when you sit down and you worked a lot here in the UAE and as well in the GCC, when you sit down.

With sovereign wealth, with family offices and regional banks here in the Gulf area, what are they actually asking for?

Is it crypto exposure also maybe where their money should work?

It's crypto exposure.

It's payment platforms.

It's financing, so you're going to have direct engagement of investing in things crypto directly.

You could also have called it indirect exposure, uh, financing activity, uh, facilitating client needs everywhere.

So it's a, it's a full gamut, uh, and now particularly with the passage of the stablecoin bill in the US, uh, stablecoins are becoming a front and center and a part of the financial vibrant economy.

And so all the use cases beyond just investment are front and center.

Definitely.

So, uh, Brett, Wall Street versus Dubai, when it comes to market now, when it comes to digital assets, let's say, what's the difference?

Well, that's a great question.

I think it's one that's blurring, and it's blurring really fast.

We're we're sitting on the eve of a market structure bill.

You know, the US selling this market structure, say like once every 30, 50 years.

And so no matter what happens with the market structure bill, it's going to be a win for crypto.

And so stablecoins have entered the, the financial sort of bloodstream of the financial economy.

You now have digitization or tokenization of assets.

And so you've got, you know, over the past 6 years we've brought in the world's biggest asset managers, hedge funds, sovereign wealth funds, private banks, wealth platforms, fintech startups, payment companies.

I mean, everyone who's anybody, uh, in the financial ecosystem is, is participating.

And so those lines are blurring and blurring quickly.

Even the vocabulary is changing, so it's not just crypto, it's become digital and, and, um, and now we're seeing, you know, this is the year that we're seeing really payment scales, uh, at huge pace.

And so no better place than here to uh bring those.

Uh, visions to reality.

Yeah, definitely.

Uh, let me get back to you, John.

John, you also helped build the Dubai Mercantile Exchange that became a global benchmark for oil.

And here, are we seeing the same moment right now when it comes to digital assets?

That's a, that's a really interesting parallel.

Um, part of the design of that exchange, the reason that worked was one, how Thoughtful the government here was to recognize that one of those crude benchmarks should be in the part of the world where most of the crude oil comes from.

It's kind of an obvious idea now but not back then, um, but they had to be willing to take certain risks because that wasn't a very popular idea at the time, um, and I think what we're seeing now is, uh, if you think about the transition back then from open outcry trading into electronic trading, and Dubai was willing to innovate on that.

We're now seeing the next evolution and how values transferred from ledgers that are 100 years old to blockchain ledgers.

So I haven't thought about that exact analogy, but it makes it kind of poetic that that's happening here as well.

Yeah, exactly, and it's exciting to see that at this moment right now in this new world of bread, Coinbase also just launched something big like Apple, Vidia, Tesla, trading 24/7 right now here from Dubai.

Tell us more about this product for our viewers and why should golf investors care about that.

Well, it goes back to your first question, which is the blurring of the old world and the new world, and it maps directly to our founder's vision, which is the everything exchange.

And so Brian's talked a lot about the everything exchange, which is having everything that one needs in one place.

And, and just given how active, actively traded, you know, stocks are.

It's an enormous and important opportunity to meet client needs and so he's doing exactly that and we're, we're launching tokenized equities and I've done and it's, it's scaling a little slowly at first, but it'll scale quicker later.

Yeah, it's big news for UAE and for Coinbase as well and the investors here, definitely.

Britt, which part also of the financial system you think now is Broken or needs a little bit more, more fixing at it.

You know, they, I think the old world would say that the, um, the exchange, you know, crypto uh skeptics can say, uh, that the, the existing system works and it does, and it works at scale.

However, we're in the midst of a giant technological change.

There's new, better, faster, cheaper, and everyone's learning at their own pace on exactly how it's happening.

And so you've seen exchanges around the world and now it's 24/7 trading and everyone that's come into contact with blockchain and different use cases around it, in particular payments, uh, is, is going through their own, um.

Their own journey of self-discovery on faster, better, cheaper, and so it's for those reasons, and those reasons will win.

So it's not really Wall Street versus crypto.

It's not really those, that's not the line of battle.

I think they're mashed together now.

They're matched together.

It's what is the best, fastest.

Both innovative way, cheapest way to get things at scale and, and that's through us.

OK, John, um, move into, um, I mean, Coinbase now, and we talked about this in the beginning, uh acquired Drebit, one of the biggest crypto, um, derivatives platform in the world now.

It's headquartered here in Dubai.

Now put the plan exactly.

Will the bit it stay anchored here in Dubai, or there are maybe other plans to move it?

Well, was that a question to you?

OK, so, so the big, the big picture plan is that Debit has had, uh, 75 to 85% market share and, and, uh, just this last week, the CFTC granted us, uh, an important ruling, and what that means is US investors can for the first time access, um, spot futures, perps, and options all from, all from the domestic US.

Which is amazing.

So the theme is connecting global markets, and the plan wasn't to run Darabit as its own thing.

It's the plan has always been to integrate everything in one place.

And so the big picture plan is connecting the UAE, Darabi, all our entire product space all in, in one, on one platform, which is our prime platform.

So integration, integration, integration is the plan.

OK, that's good, John.

Yeah, so there's always been, um.

There's always been a desire to have 24 hour active liquid markets and, and Brett, you know, back when in our day we used to talk about this idea of passing the book, we literally have an office in New York, London, you just work your way around the world, right?

So and every, every 8 hours, typical 8 to 10 hour trading day, you would pass that book over to that next time zone.

So in theory you would have 24/7 liquidity.

Now it was very janky and didn't work very well and so kind of what we're talking about now is finding locations around the world that are universally trusted in Dubai and UAE credible regulatory regime, uh, tons of capital, uh, and over the last 10 years you now have a very, very vibrant financial hub here.

You have the traders, you have the back office, the front office, all of that.

So it's the ideal place to consolidate all the non-US liquidity and then link up those two pools of liquidity and you have 24/7 trading.

And if you layer on that agentic trading, um, you, as Brett said, it's kind of hard, I think for people in the current, uh, world to imagine, but it could be 10 times bigger than what it is, even though the current system does work, um, it's difficult when you're inside the system to realize how much larger it could be.

Well, it's kind of goes back to what's broken, just think how long and complicated his answer was, right?

About passing a book, blah, blah, blah, blah.

Uh, FX is traded 24/7 for years, but yet nothing else does.

And so making everything trade risk is continuous.

Risk doesn't stop in the morning, you know, or, or, or start and stop in the morning based on where you are, it's continuous.

And so having the ability to express your positions 24/7 in all markets is an important thing.

Yeah, thank you so much, John, and thank you, Brett, for being with us today.

Thanks, Rhoda.

Thank you.