UAE triggers ‘gold replacement’ debate with $518mln Bitcoin move, now what?

Key Takeaways 

Why is the UAE aggressively buying BTC? 

The country views it as “digital gold,” worth a long-term bet as a strategic asset. 

What’s the broader demand from other countries? 

There has been a steady rise in demand from governments worldwide; now this cohort holds over 645,000 BTC. 

The United Arab Emirates (UAE) has tripled its Bitcoin holdings in 2025.

According to a Bloomberg report, Abu Dhabi Investment Council (ADIC) scaled its position in BlackRock’s iShares Bitcoin [BTC] Trust (IBIT) by 230% by the end of Q3. 

At that time (end of September), the position was valued at nearly $518 million, about 8 million IBIT shares, up from 2.4 million three months earlier. 

ADIC operations are run independently, but it’s a subsidiary of Mubadala, a sovereign wealth fund that is fully owned by the UAE. Asked about the reasoning behind the aggressive BTC bid, an ADIC spokesperson told Bloomberg, 

“We see Bitcoin playing an increasingly important role alongside gold; both assets contribute to diversifying our portfolio, and we expect to hold them as part of our near and long-term strategy.”

That stance positioned BTC as a strategic reserve asset for the UAE. That raised a larger question: Was the nation-state game theory around BTC now taking shape?

Czech, El Salvador & more scale BTC holdings

Perhaps one of the most notable new players is the Czech Republic. The country’s central bank acquired its first $1 million in BTC, stablecoin, and tokenized products. 

Earlier in October, Luxembourg also announced that it had allocated 1% of its sovereign wealth fund to BTC and crypto assets, amounting to about €7 million. Other new buyers this year include Saudi Arabia. 

At the same time, OGs like El Salvador have upped their acquisition and recently added $100 million BTC, bringing the country’s overall stash to 7,474 coins, worth $676 million. 

Now, governments ranked as the third-largest holders of BTC, with 645,000 BTC, after public companies and ETFs. 

Source: Bitcoin Treasuries 

For digital asset manager Bitwise, the government’s overall BTC holdings translated to only 1.5% compared to 17% ownership in gold.

To the firm, this meant that BTC was still in the early stages of adoption among states, and acceleration could also boost its value. 

Q4 drawdown tests conviction

Source: Bitwise

Even so, the Q4 sell-off, which has resulted in a nearly 30% decline in the BTC price to $90k, has exposed current nation-state holders to a significant paper loss.

Perhaps the Q4 filings, expected in early 2026, will show which nations had strong long-term conviction during this period.