(MENAFN- Khaleej Times)
The UAE has become one of the most advanced countries in digital currencies in the Middle East in general and the Gulf countries in particular, said economist Dr. Abdul Rahim Al-Farhan.
“The UAE is currently on its way to becoming a global center for digital assets and blockchain, thanks to its flexible regulatory policies, advanced digital infrastructure, and the huge investments of global companies, which make it a major destination for investors in cryptocurrencies,” Al-Farhan said.
Real estate asset tokenization
He said that the UAE has recently witnessed the entry of many global companies into the digital currency market, which achieved many developments, including the real estate asset tokenization. At the beginning of this year, Damac Properties Group announced a partnership with the Mantra blockchain platform to convert real estate assets of about one billion dollars into digital tokens, allowing investors to easily and purchase parts of the properties. The move increases the liquidity of the real estate market.
Damac was not the first. Last September, Standard Chartered Bank began providing digital asset custody services, which reflect major financial institutions the confidence in the UAE's digital currencies, and Brevan Howard Digital was the first customer for this digital service.
Last year, Tether also announced the launch of a new stablecoin pegged to the UAE dirham, in an important step to reduce reliance on the US dollar in digital transactions and facilitate financial transfers in the UAE.
Within the framework of the comprehensive digital transformation, global trading platforms such as Binance and Crypto, were licensed to operate within the Dubai Future Zone, which attracts major emerging companies in this field.
Dr. Abdul Rahim Al-Farhan
Al Farhan pointed out that there are many challenges facing the digital currency sector in the UAE. High price fluctuations in digital currencies, for instance, poses great risks to investors, as well as fraud and money laundering operations, which is being addressed meticulously by imposing many regulations and laws seriously and strictly to control performance in this sector. That will be reflected in investors' safety in the future.
Safe investment environment
He stressed that the UAE is one of the best destination for those looking for an organized, safe and promising digital investing environment. That is because of the continuous government support to attract major companies to work in the UAE as one of the policies that encourage digital currency transactions and is one of the best destinations for investing in digital assets.
The economist noted that Dubai had issued a special law to regulate digital assets in 2022. They also established the Virtual Assets Regulatory Authority (VARA), with the aim of supervising all digital currency activities in the UAE. The VARA grant licenses to companies operating in the same field, set regulations to protect investors and monitor the fight against money laundering and terrorist financing.
Al-Farhan pointed out that the UAE Central Bank supervises the aspects related to digital payments, which are regulated by the Financial Services Regulatory Authority (FSRA) of the Abu Dhabi Global Market (ADGM), which is an important centre for (Web3) companies and blockchain technologies, and attracts investment funds for major financial institutions looking to invest in digital assets.
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