UAE, Saudi Arabia Set to Jointly Issue a Cryptocurrency

Dec 14, 2018 at 21:41

The Saudi Arabian Monetary Authority and the United Arab Emirates’ (UAE) Central Bank is expected to jointly issue a digital currency for use in cross-border transactions.

Based on reports from local news outlet Gulf News, banks from the two countries will rely on blockchain technology to develop a new cryptocurrency that will be limited to inter-bank transactions and not extended to consumer usage.

The parties are yet to reveal a target launch date for the completion of the said project which sparked skepticism from some experts.

“This is probably the first time ever that we witness the cooperation of monetary authorities from different countries on this topic. We hope this achievement will foster similar collaboration in our region,” UAE Central Bank governor Mubarak Rashid al-Mansouri said.

Meanwhile, Nassar Achkar, chief executive officer of the Dubai-based Hyperchain, lauded the move citing that governments of both countries are now becoming more open to digital currencies.

“Dubai is paving the way for checks and balances and they are regulating (this industry…) Banks are relying on the technology behind the cryptocurrency to use it because it’s faster, more efficient and more transparent,” he added.

It can be recalled that the UAE Central Bank earlier declined to endorse digital currencies like Bitcoin, arguing the possibility of it to be utilized in financing terrorist and illegal activities. Saudi Arabia also warned before that cryptocurrency trading should be avoided because it remains unregulated.

Last September, UAE’s Securities and Commodities Authority board, approved a plan to regulate initial coin offerings and recognize them as securities.