The proceeds will primarily go toward accelerating product development, enhancing the bank’s payment network and hiring more staff, the people said. The purchase of a stablecoin payments firm is planned for the first quarter in the Middle East or Europe, they said. A spokesperson for the bank declined to comment on the fundraising, valuation or acquisition plans.
Optimism about the digital-asset sector is growing, helped by the promise of supportive industry regulations in the US under President-elect Donald Trump. The value of the crypto market has climbed by about US$1 trillion since Trump’s victory in the election on Nov 5, and some commentators expect a pickup in deal-making to ensue in coming months.
Stablecoin Usage
Stablecoins are crypto tokens pegged to fiat currencies, usually the US dollar. Their value is typically underpinned by reserves of cash and bonds. Interest in this corner of digital assets is expanding as stablecoins offer speed, cost and accessibility advantages over some regular banking payment rails.
A range of jurisdictions globally are striving to develop crypto hubs that both protect investors and prove attractive to companies specializing in blockchain-based technology and services. Bahrain, Dubai and Abu Dhabi are among the Middle Eastern centers vying to woo businesses.
See also: Bitcoin plunges as crypto feels trade war pain
Singapore Gulf Bank allows companies to manage traditional financial and digital assets on a single platform and plans to extend the service to individuals by the end of this year. The bank is backed by sovereign wealth fund Bahrain Mumtalakat Holding Co. as well as Whampoa Group.
Crypto businesses have sometimes struggled to access the banking sector because of the industry’s volatility and history of scandals. The icy reception is thawing as more and more financial centers roll out dedicated rulebooks.
