Sands of change: UAE enables private sector to adopt blockchain tech
The UAE has been proactive in integrating blockchain into the existing governance ecosystem, and the private sector benefits from the spillover effect.
It is no secret that the United Arab Emirates, along with Switzerland, Singapore and several other countries, is one of the most forward-looking tech nations in the world, with the Middle Eastern powerhouse promoting the use of blockchain in almost every sector imaginable, from energy to shipping to media.
To help the country with its adoption efforts, the UAE government has launched two extensive, well-crafted initiatives — i.e., the Emirates Blockchain Strategy 2021 and Dubai Blockchain Strategy. While the former seeks to spread the use of blockchain tech for facilitating over 50% of all government transactions by 2021, the latter will help Dubai transform itself into the first city in the world to be fully powered by blockchain.
Furthermore, the Dubai Future Foundation, which is backed by Sheikh Mohammed bin Rashid Al Maktoum, prime minister of the UAE and ruler of Dubai, recently established the Global Blockchain Council in order to help spur the exploration and real-world applications of blockchain tech across a host of financial and non-financial sectors within the country.
As things stand, the council currently comprises 46 members, including government entities, international players, leading local banks, as well as tech firms from across the globe.
Where does the UAE stand?
On the subject of the UAE’s holistic crypto outlook, Hadi Malaeb, CEO of AgoraGroup — a firm that seeks to facilitate international trade — told Cointelegraph that in his view, the UAE administrative regime is by far the most responsive to the crypto industry in the MENA region and one of the most progressive in the world.
To drive home his point, he highlighted that the UAE’s Securities and Commodities Authority recently published “The Authority’s Chairman of the Board of Directors Decision No. (21/R.M) of 2020,” which provides local businesses and digital asset owners with an additional detailed outlook regarding the regulation of crypto assets. Malaeb added:
“I can tell you from first-hand experience that the industry has developed tremendously within a very short period of time from an investment, adoption and regulatory standpoints.”
Business adoption is growing
While most countries across the globe are just starting to recognize the monetary and technological proposition put forth by blockchain and crypto tech, the UAE has already set in motion a number of projects that can potentially transform the country’s landscape in the coming decade or so.
For example, UAE’s Roads and Transport Authority is currently working on a project that seeks to help establish a fully automated vehicle lifecycle management system using an advanced blockchain framework. In brief, the final platform will create a mesh of manufacturers, dealers, regulators, insurance companies, buyers, sellers and garages, thereby creating a detailed record of each vehicle through the entirety of its life cycle.
On the subject, Khaled Alkalbani, CEO of Ideaology — an open-source project built atop the Ethereum ecosystem — told Cointelegraph that while use cases related solely to cryptocurrencies are low at the moment, the UAE is without a doubt one of the most advanced in terms of blockchain use cases and applications, adding:
“The UAE, as always, is bustling with blockchain, digital assets, crypto-related news — to mention, our central bank is using DLT for SME funding and trade finance. The Abu Dhabi Global Market (ADGM) is building an excellent foundation to use/trade crypto, as they believe that this technology will help the economy, businesses and investors.”
Notable use cases
In this vein, researchers affiliated with the UAE’s Khalifa University recently developed digital immunity passports, using blockchain tech. The passport, which will come in the form of a smartphone app, will serve as a digital document detailing a person’s innate risk of spreading COVID-19. Furthermore, the passport will also contain details such as prior negative test reports, vaccination info, etc.
The offering could potentially prove its value in settings where there is a high risk of transmission, like sporting events, live concerts, movie theatres or shopping malls. Not only that, but it could also help the travel industry immensely because it could streamline the screening process of high-risk individuals.
Etisalat, an Emirati-based telecommunications services provider, recently announced the launch of a new blockchain platform that will enable the company to conduct all of its human resource-related activities in a decentralized, transparent fashion. What’s more, Etisalat’s customer engagement program, Smiles, launched the UAE’s first-ever Rewards Exchange powered by blockchain tech.
Related: The United Arab Emirates chase crypto and blockchain adoption
The company also has its hands in a number of other notable blockchain projects, most notably, a platform called Shahada, a tamper-proof digital certificate ecosystem that can be used by any educational institution operating in the region, as well as UAE’s trade finance platform UAE Trade Connect.
Lastly, the UAE’s national carrier Etihad Airways joined forces with open-source travel platform Winding Tree to explore the use of blockchain tech, primarily as a means of distributing its various products and services directly to its customers, thereby cutting out the need for any intermediaries.
Unprecedented interest across the UAE
With each passing year, the UAE seems to be garnering more business interest from blockchain enthusiasts globally, especially as the country continues to help spur the widespread adoption of the technology by providing startups as well as big-name firms with a highly conducive atmosphere to develop their envisioned platforms with the least amount of regulatory pullback.
In this regard, Malaeb pointed out: “We have hosted more than six events in that space within a period of three years,” adding that AgoraGroup’s conferences “have helped startups and well-established companies in this industry to meet, one on one, with pre-qualified investors, and we have witnessed many deals taking place.” Overall, he believes that:
“There is a palpable increase in appetite of institutional investors to explore investment opportunities in digital assets.”
Lastly, Mohanned Halawani, a communications expert and blockchain technology specialist, believes that the country’s tolerance toward practicing new technologies has had a direct impact on the number of crypto entrepreneurs moving to the country. He believes that UAE’s fiscal foundation makes it easier for local firms to adopt blockchain solutions with relative ease, adding:
“It is a tax haven compared to countries with similar economic growth. […] But yet, there is still lots of room for blockchain adoption here. We hope to see crypto being accepted in retail businesses very soon.”
Some of the interviewees have participated in the Global Blockchain Congress in Dubai on Feb. 9, hosted by the Agora Group.