UAE's Plan to Make Crypto a Part of its Economic Development - Is it Viable?

By Harish Chandra, content writer  |  Monday, 30 January 2023, 01:57:08 PM IST

UAE's Plan to Make Crypto a Part of its Economic Development - Is it Viable?

Introduction

The march towards crypto adoption is fast spreading across the globe today, with the UAE turning out to become one of the most crypto-friendliest nations. The recent statement by the country's minister of state for foreign trade; on the government's plans to actively integrate cryptocurrency in its trade and investment as a means of promoting economic development has triggered large interests in buying Crypto in UAE today. Many investors within the region are now eager to invest in Crypto hoping it will come under the government's regulation soon. Can the adoption of crypto in its trades lead to viable economic development within the UAE? What impacts will this have on crypto trading within the region today? This work has addressed these important questions.

What do you know about crypto?

Cryptocurrency, or "crypto" for short, refers to a digital or virtual currency that uses cryptography for security and operates independently of a central bank. Investment into Crypto sparked off in 2009 with the creation of the first cryptocurrency known as Bitcoin by an unknown founder. Since then, more than a thousand other cryptocurrencies have been created today including Ethereum, Ripple, and Litecoin. One common factor to all the cryptocurrencies is that they run on a decentralized system, known as blockchain technology which helps them to secure, track and verify transactions. They can be bought, sold, and traded on various online platforms, and can also be used to make purchases or send money to other individuals.

United Arab Emirates (UAE) plans to make Crypto a part of its Economic Development Program

Cryptocurrency is set to play a major role in trade for the United Arab Emirates (UAE). In a recent interview with Bloomberg, the State Minister for foreign trade - Thani Al-Zehoudi observed that the country has gotten great talents from the crypto sector. He further revealed that the UAE's government is actively exploring the use of cryptocurrency in trade and investment as a means of promoting economic development.

The UAE has been at the forefront of blockchain and cryptocurrency adoption in the Middle East, with the government actively encouraging the development of a local blockchain ecosystem. The country has also established several initiatives, such as the UAE Blockchain Strategy 2021, aimed at promoting the use of blockchain technology in various sectors, including trade and investment.

The foreign trade minister's comments come as the UAE looks to diversify its economy away from oil and gas, which has been the mainstay of the country's economy for decades. Cryptocurrency and blockchain technology has the potential to play a significant role in this diversification effort by promoting trade and investment in the country.

Is it a viable option for the UAE to integrate crypto as part of its Economic Development Package?

The remarks of the UAE's foreign trade minister on crypto playing a major role in UAE trade is a positive sign for the crypto industry and it could lead to viable economic development in the country. The government's active involvement in promoting the use of blockchain technology in various sectors including trade and investment is a clear indication that the UAE is looking to leverage the potential of this technology to drive economic growth

Added to this, another important advantage of using cryptocurrency in its trades is that it allows for faster and cheaper cross-border transactions compared to traditional methods. This can help to increase the efficiency of trade and reduce costs for businesses operating in the UAE.

Above all, the use of blockchain technology in trade can also help to increase transparency and reduce the risk of fraud.

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