The National Bank of Bahrain launched the region’s first bitcoin investment fund

The National Bank of Bahrain (NBB) has launched the GCC region's first Bitcoin-linked structured investment fund for institutional and accredited investors.

This product is developed in partnership with ARP Digital and is designed to provide investors with a secure way to use their Bitcoin profits.

Bitcoin investment fund

According to local media reports, the structured investment fund is held at a pre-defined limit and offers accredited investors a unique opportunity to take advantage of Bitcoin's upward performance.

This design ensures that investors can enjoy 100% capital protection against downside even as they take advantage of Bitcoin's growth. This acts as a hedge against the volatility commonly associated with digital currencies.

“We are proud to make this structured investment, which combines digital asset exposure with the security of capital preservation,” said Hisham Alkurdi, CEO of NBB's Markets and Client Solutions Group.

The new initiative aligns with NBB's strategy to enhance its wealth management offerings by providing solutions that balance growth potential with risk mitigation. This move will increase demand for investment products that allow exposure to digital assets and fully protect investors from market fluctuations.

Abdullah Kano, the founder of ARP Digital, emphasized the importance of their partnership, saying that it will bring a game changer in the regional market. They explained that they have combined their expertise in digital assets with NBB's broad financial sector reach to develop a product that offers exposure to Bitcoin in a “highly secure framework”.

Bahrain's expanding crypto ecosystem

Dalal Buheji, Executive Director of Business Development for Financial Services at the Bahrain Economic Development Board, commented, “This Bitcoin-related structured investment launch is a prime example of the true potential of Bahrain's robust financial services ecosystem, an attractive and well-tuned environment for innovative solutions.

Bahrain is attracting more digital asset businesses in its efforts to develop an “innovation-friendly” crypto and fintech ecosystem. According to Eric Anziani, COO of Crypto.com, this approach involves implementing clear rules that strike a balance between consumer protection and trade.

In September, the company was granted a license by the Central Bank of Bahrain, joining crypto exchanges such as BitOasis and Binance, to operate locally from March 2022.

A recent report by Chainalysis also revealed that the Middle East and North Africa region accounted for 7.5% of the global cryptocurrency transaction volume between July 2023 and June 2024, totaling 338.7 billion dollars.

Most of these transactions were conducted by institutional and professional investors. While centralized exchanges (CEXs) remain the main source of crypto inflows in MENA, demand for decentralized platforms and DeFi applications is slowly growing.