United Arab Emirates investors are leaning into the AI sell-off rather than fleeing it, even as regional conflict puts the Gulf’s bid to be a global hub for AI and digital assets under strain.
eToro data shared with Cointelegraph show UAE users increased holdings in software and AI infrastructure names that slid sharply in Q1, indicating they “bought the dip” instead of broadly de-risking. That behavior implies continued exposure to long-term AI and digital-infrastructure themes despite heightened risks to data centers, logistics and cross-border tech builds in the Gulf. A April 13 Deutsche Bank report argued the shock is more likely to sharpen than derail demand for AI, cybersecurity and sovereign digital infrastructure in the region.
Josh Gilbert, market analyst at eToro, told Cointelegraph UAE investors became more selective about risk in Q1 and were driven by long-term themes rather than a blanket risk-off approach. The clearest signals were purchases of AI infrastructure and software stocks: ServiceNow (+125%), Super Micro Computer (+65%), Adobe (+54%) and Oracle (+38%) all saw notable increases despite market pressure.
On the crypto front, Gilbert noted Strategy Inc. remained the eighth-most-held stock among UAE users, signaling ongoing exposure to crypto-linked equities.
War puts Gulf AI ambitions under pressure
The US-Israel conflict with Iran has exposed new vulnerabilities for Gulf tech infrastructure. Deutsche Bank pointed to reported strikes on Amazon Web Services data centers in the UAE and Bahrain and to threats against the planned 1GW Stargate campus in Abu Dhabi.
Gilbert said the conflict is driving volatility, including sharp oil price swings that can affect tech valuations. UAE investors appear to be keeping core exposure to diversified mega-cap tech while rotating within the sector — a nuanced, risk-aware tactic rather than wholesale exit.
Deutsche Bank also emphasized the Gulf, and particularly the UAE, is unlikely to abandon the AI race. The region benefits from cheap energy, a dense pipeline of data center projects, and large sovereign wealth funds (around $5 trillion globally in 2025) with Abu Dhabi vehicles among aggressive backers of global AI deals.
Crypto companies stay open as conflict remains
In Dubai, crypto firms report the conflict has slowed operations but not ended the city’s hub ambitions. HashKey MENA’s managing director Ben El-Baz told Cointelegraph operations remained “broadly functional,” helped by cloud-based trading and custody systems that reduce dependence on a single physical location, even as remote work and travel disruptions occur.
Other firms, including Binance, continued normal operations despite contrary reports. A Binance spokesperson said employees were offered temporary relocation as a precaution, but the vast majority stayed, while major events such as Token2049 were postponed.
Dubai-based Ento Capital says the conflict is “refining” rather than derailing the GCC narrative. Senior executive Hayssam El Masri told Cointelegraph investors have shifted from “confidence-driven to risk aware,” but generally are not exiting the region. He suggested that war-tested resilience and continued investment in AI, cloud and crypto infrastructure could strengthen the GCC’s long-term position.
Regulators bet clear rules will anchor capital
Dubai’s Virtual Assets Regulatory Authority (VARA) has continued rolling out its activity-based framework during the turmoil, including detailed guidance on token issuance and formal rules for crypto derivatives.
Sean McHugh, VARA’s head of market assurance, told Cointelegraph that in stress periods serious market participants seek clarity, not the lightest touch. He argued Dubai’s mix of transparent licensing, visible supervision and active enforcement is designed to persuade institutions to treat the emirate as a strategic base rather than an opportunistic stopover.
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