Is Dubai setting the stage for mass adoption of cryptocurrency and blockchain technology?
There’s a lot of blockchain and cryptocurrency news coming out of the United Arab Emirates (UAE) today. A planned official digital currency for Dubai is reportedly one step closer to everyday use. Relatedly, UAE officials announced plans to develop rules that would allow initial coin offerings (ICOs) in the country.
According to an October 8 blog post from Pundi X, which creates point-of-sale (POS) solutions for those who want to spend or accept crypto, it has partnered with the country’s credit bureau, the Emirates Credit Information Company Limited (emCredit), to bring its technology to Dubai citizens. Ebooc Fintech and Loyalty Labs, creator of a blockchain-based customer loyalty program, is also part of the partnership.
Dubai residents will be able to use an emCredit-developed virtual currency, emCash, to purchase retail goods and services, as well as pay school fees and utility bills. Since emCredit falls under the Dubai Department of Economic Development, emCash would be the official digital currency of Dubai. Of course, it first has to be created.
emCash will reportedly be the “digital equivalent of the UAE dirham,” which will apparently immunize it from wild price fluctuations experienced by other cryptocurrencies. To facilitate payments in emCash, UAE officials will begin installing POS mechanisms provided by Pundi X (and running on a blockchain platform) at government storefronts, with plans to increase the installation of POS mechanisms in the coming years.
This announcement comes on the same day that Reuters reported the Emirates Securities & Commodities Authority has announced plans to draft new regulations that would allow ICOs in the country.
If approved, the new laws would offer companies looking to raise capital an alternative to initial public offerings of stocks, which have reportedly been in decline due, in part, to waning oil prices in the region.
The UAE seems to be positioning itself as a leader in blockchain and cryptocurrency technology, with Dubai in particular making strides. Just last month, the Dubai Department of Finance received a blockchain upgrade to streamline the process of transaction reconciliation.
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