Last Updated on January 31, 2024 by Ameer Hamza
Investors’ opinions about crypto assets have shifted dramatically. Virtual currencies and blockchain, previously considered suspicious, have solidified their position in the financial market. Several cryptocurrency startups are going public, including Coinbase. Consumer behavior towards crypto adoption has altered as a consequence of the digital revolution in payments. Approximately half of UAE citizens plan to utilize cryptocurrencies in the coming years, according to a survey conducted two months ago. Contrarily, 63% of respondents showed their willingness to adopt digital assets in the current year.
In the field of financial technology, the Middle East has firmly established itself as a blockchain powerhouse. The UAE policymakers recognize that blockchain technologies are becoming increasingly popular throughout the world. The UAE is being hailed as a leader in an innovative transformation, keep reading the following sections.
In 2018, the UAE released its Blockchain Strategy 2021 in an effort to encourage the adoption of blockchain technology. Essentially, it established a deadline by which all government transactions would be conducted via decentralized technology. After this, FSRA implemented a framework for operating crypto-asset businesses in Abu Dhabi Global Market (ADGM) in 2018. The regulatory infrastructure in the crypto-asset industry was attractive and permissive due to constant participation and innovation. Consequently, Abu Dhabi emerged as a desirable location for both large and small-scale blockchain, and crypto firms.
Moreover, the students and faculty of the NYU Abu Dhabi campus, along with Khalifa University, have made significant contributions to cutting-edge technologies including blockchain and artificial intelligence. The education system has helped Abu Dhabi become an innovation leader.
The last stumbling block in digital technology adoption is legislation. UAE has, however, developed a transparent regulatory system for crypto assets that corporations, investors, or traders need to operate in the cryptocurrency market. The UAE has positioned itself as an example by creating a complete legal structure for crypto assets and blockchain. Blockchain technology is a crucial part of the UAE’s contributions to the global economy, and the country has a number of attractive features making it a global hub.
With the implementation of blockchain, the country has experienced remarkable success throughout the public sector and has saved an estimated Dh11 billion annually in transaction and document processing. Further, with the help of blockchain technology, Dubai police provided a number of lost passport certifications. In addition, the Ministry of Health and Prevention developed a blockchain system to store and process medical data.
The state has already approved the licensing of three regulated exchanges, with more expected in the coming months. The scope of Abu Dhabi’s vision for the blockchain-enabled future is much broader than regulations. Mubadala is investing in blockchain-related startups enabling the emirate to get dividends and making UAE a blockchain powerhouse.
The appetite for crypto and blockchain is growing like wildfire. As of 2020, digital payments have reached a total of $18.5 billion, more than doubling from the past year. The UAE plan provides a valuable roadmap for other nations to follow. In addition, Dubai’s ecosystem has been instrumental in helping to advance digital transformation, and clearly, that trend won’t slow down anytime soon.