UAE Central Bank To Launch CBDC For Payments• February 16, 2023 10:42 pm • Comments
The central bank of the United Arab Emirates just announced that they will be launching a new CBDC that will allow for both domestic and international payments.
Many investors and speculators have expected that this will happen at some point given that the UAE has been known as a region that has a pro-crypto regulatory environment.
After all, the region is now known as one of the major crypto hubs in the world and the fact that a CBDC will soon be used for payments indicates that the country is quick to take advantage of blockchain.
CBDCs are expected to continue to be more popular among central banks in the next decade and there are already a few crypto projects that allow for the easy implementation of them such as Ripple’s CBDC platform.
The country expects that this launch will help grow many industries such as e-commerce and the financial industry in an effort to make the country truly cashless.
United Arab Emirates Central Bank recently launched a FIT program aimed to promote digital transactions and encourage innovation in the space which also will sharpen UAE’s prospects to become the financial and digital payment hub.#KOMnews #uae #cbdc #digitalpayment #cryptonews pic.twitter.com/YLDhAqA4kF
— Kommunitas.net Official (@Kommunitas1) February 15, 2023
Parallelly, the government will also launch a card payment platform to “facilitate the growth of e-commerce” and an instant payments platform to “support financial inclusion and enable a cashless society.”
The launch of these digital payment infrastructures, including the issuance of a CBDC, are a part of the first stage. Notably, the government aims to “drive financial inclusion, promote payment innovation, security and efficiency, and achieve a cashless society” by doing so.
According to His Excellency Khaled Mohamed Balama, Governor of the CBUAE, the FIT program “will support a thriving UAE financial ecosystem and its future growth.”
Furthermore, the Governor said,
“We will work with our partners to implement the Program, achieve its goals, accelerate the adoption of digital services in the financial sector and attract the best talent.”
As the use of crypto and CBDCs is continuing to expand in the region, it is also noticed that many regulations are starting to come out in response to the growth.
Some regions are encouraging growth while others have put regulatory obstacles which cause concerns for potential investors.
When it comes to CBDCs, many are concerned about the privacy aspect of it, but it seems that this is something that may be inevitable if a country wants to use digital assets as currency.
As of right now, Ripple’s solution still holds the lead when it comes to CBDC implementation and it has not been confirmed whether or not this new CBDC launch in UAE will have Ripple involved.
Ripple has recently been involved in CBDC research for the EU region which makes it the most likely candidate at the moment.
One of the UAE’s nine objectives is the research and development of a central bank digital currency #CBDC. https://t.co/EkxvTTKC2M
— Bitcoin News (@BTCTN) February 14, 2023
The CBUAE’s statement revealed several initiatives under the FIT program, which the government will be interested in launching over the coming days.
The initiatives, numbering nine in total, reinforce the central bank’s drive to “enhance monetary and financial stability and consumer protection through robust financial infrastructure and adoption of digital technologies.”
Apart from the proposed launch of CBDCs, FIT program initiatives include the launch of a Card Domestic Scheme, eKYC, Open Finance, Supervisory Technology, and an Innovation Hub. Others include a robust Financial Cloud, an Instant Payments Platform, and an Excellence and Customer Experience initiative.
Dubai, an Emirate in the country, has already been basking under the light of new regulations for its local virtual currency ecosystem and the creation of a new regulatory entity.
A step in the right direction as #UAE works on laying out a robust regulatory framework while promoting the use of digital assets.https://t.co/tiFjDk0OTu
— Ahmed Wael Ismail (@AhmedWIsmail) February 13, 2023
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