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Saudi Arabia and UAE Join Hands to Conduct CBDC Experiment; Participants Include Six Major Banks

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Cryptocurrency developments across the world have captured the attention of several major institutions, with some governments taking the extra steps to adopt virtual currencies. This rapid growth was personified recently when Saudi Arabia and the United Arab Emirates announced a joint central banked digital currency [CBDC] experiment between the two countries.

On Monday, the two countries revealed details about Project Aber which was kick-started in 2018. During the transfer, both parties used a single CBDC issued by the central banks instead of separate currencies that need to be converted.

One of the major reasons why the single CBDC transfer worked is that both the UAE Dirham and the Saudi Riyal are pegged to the United States dollar, creating a common backing. The main idea behind the experiment was to show the rest of the world that the decentralized economy was fast approaching. The experiment used synthetic transactions instead of real money, a transition that is set to be in the pipeline.

According to reports, the difference in monetary policies also features as part of the discussion between Saudi and the UAE. Sources added that future projects include an instant settlement for capital market transactions, use of multiple currencies as well as delivery versus payment. A major advantage of the currency single CBDC setup was that it removed the need for Nostro accounts to be maintained by a separate commercial bank.

The two central banks were not the only participants of the experiment as they were joined by six other commercial institutions. The banks of Riyad, Al Rajhi, and Al Inma in Saudi and Dubai Islamic, First Abu Dhabi, and ENBD in the UAE were the banks that also tested their virtual assets mettle. The aforementioned banks were also brought in to discuss future plans of issuing a CBDC for a specific transfer and then redeeming it at the end.

Security was also discussed during the experiment as it was one of the most important characteristics to bring customers in. All the participants unanimously agreed that transactions need to be resilient no matter what the situation with the transmitter and receiver. If all goes well and good, experiments in the future would include more participants and a much larger transaction ecosystem.

Abu Dhabi Takes Keen Interest In Tech Investment; Looks For Investors In Israel

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Auliq Ice said, “Rather than trying to reinvent the wheel, build on to that which is already excellent.” Modernization is essential for the growth of society. Mankind’s forefathers have laid down the foundation and the world has been building on it. With digitalization progressing at full speed, the collaboration of finance and technology has been vouched for by many. Abu Dhabi and Israel seem to be taking the digitalization train to aid fintech in their countries.

Abu Dhabi And Israel Work Together Following Amends In Relations

Speaking at a recent financial technology conference in Abu Dhabi, Ibrahim Ajami, the head of Mubadala’s ventures unit, revealed that it was looking for Israeli fund partners as well as technology firms that entail a high-growth rate. The government-owned, global investment company, Mubadala seeks the aforementioned in order to co-invest to bolster the commercial ties between UAE and Israel.

Back in August, the United Arab Emirates signed an agreement with Israel in order to normalize relations. This peace deal was brokered by the United States and was preceded by President Trump. Following this, both regions have been engaging in several activities. With its latest move, Abu Dhabi’s Mubadala intends to open up opportunities with joint funds and joint ventures. Ajami, however, pointed out that the platform was still in its early stages in terms of evaluation.

Prior to Mubadal’s latest move, the platform had co-invested with Israeli investors all across the globe. However, the state-owned investment platform intends to pave the way for closer ties between the two countries. Ajami added,

“We are always excited about Silicon Valley. But we are also looking at Europe, we’re looking at the Middle East, we’re looking at India and we would like to be very active in China.”

The peace deal has certainly benefited both Israel as well as the UAE as it opens up more trade opportunities. Speaking about the peace deal, Avraham Ortal, the Chief Executive of Israel’s second-largest bank, Bank Leumi added,

“Once the peace agreement was signed we thought that being the leader for connecting Israeli companies and Emirati organisations could be our role.”

Earlier this week, the bank reportedly brought in a delegation of executives to Dubai from Israel. While these execs ranged from energy and tech to real estate, Ortal suggested that they were still in the stage of “planting the seed” and that they had a long way to go.

Etisalat Enters the Blockchain Fray as Company Partners with Smartworld to Launch Shahada

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Blockchain technology has played a pivotal role in several mainstream industries over the past couple of years even as the cryptocurrency market struggles to break into the mainstream realm. The underlying technology upon which currencies like Bitcoin have been built was being considered as a viable source for new developments.

The latest reports have revealed that the telecommunications giant Etisalat has partnered with Smartwolrd to bring Shahada’s digital certificate platform to the education sector. The move is set to utilize the organization’s blockchain technology to help governments entities and universities to digitally attest and certify certificates. 

The partnership is set to pave the way for credible information when it comes to the education sector as well as carrying the information forward to other industries. Shahada was launched this February by a collaboration between Smartworld and Grape Technology. The latter is a UAE-based blockchain startup with an aim to bring educational institutions, government entities, and external stakeholders together on a native blockchain platform.

This is not the first time that blockchain technology has been used to maintain standards in the education sector, as universities in the US have already done the same. Blockchain technology is most effective because of its transparency and its tamper-proof nature. Any changes made to the Ledger would be visible to everyone, an aspect that will be useful in verifying the legitimacy of university certificates.

Smartworld has stated that the platform will save time and resources by letting them focus on multiple aspects of the education sectors. The implementation of the technology will allow universities to securely issue credentials on the blockchain, thereby eliminating any chance of forgery. Shahada plays an important role in integrating education and blockchain technology because it is aligned with both the UAE Blockchain Strategy 2020 and the 50-Year Charter launched by UAE Prime Minister HH Sheikh Mohammed bin Rashid Al Maktoum. According to reports, the platform will also allow UAE ministries to play a part in verifying documents on the blockchain.

 

Etisalat and Noor Bank launch eWallet International Remittance Services in UAE to 200 Countries

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Etisalat and Noor Bank announced the launch of eWallet – an international remittance service that will allow financial transactions between UAE individuals and 200 countries worldwide.

The joint venture assured eWallet customers would be able to send money to relatives abroad in real time, in partnership with MoneyGram International, without having to visit a branch or go outside during the Covid 19 pandemic.

An eWallet consumer may either send funds directly to a recipient’s bank account or to a mobile wallet, depending on the destination of the recipient. Now eWallet customers can make real-time, international money transfers from their homes.

Transfers of money can now be made digitally to more than 350,000 locations, consisting of banks, counter agents and international mobile wallet operators in more than 200 countries and territories worldwide.

Ahmed Al Awadi, Chairman of eWallet, said, “eWallet continues to be an innovative solution that uplifts the way UAE residents conduct financial transactions today. We understand that in light of the current global situation, people are increasingly choosing to send money digitally from the comfort and safety of their homes. As people work to support their family and loved ones across the globe, we aim to enable them to safely and instantly remit money to over 200 countries and territories worldwide.”

Regulated and licensed by the UAE’s Central Bank, Like other mobile wallet services, eWallet is not contingent on having a bank account credit card or debit card to make digital payments.

All customers need to register for the eWallet account is a valid Emirates ID and a working UAE mobile phone.