The United Arab Emirates (UAE) is positioning itself as a global hub for blockchain and cryptocurrency innovation, with key trends emerging in Shariah-compliant services, dirham-pegged stablecoins and international talent migration, according to industry leaders.
At the recent Bitcoin MENA and Abu Dhabi Finance Week events held in the UAE, crypto professionals discussed the key trends shaping the future of the industry in the Middle East.
Cointelegraph spoke with Blockdaemon’s chief revenue officer, Andrew Vranjes; Core DAO’s head of ecosystem growth, Adam Bendjemil; and MatterFi’s head of business development, Jakub Zurawinski, to get their insights on trends they’ve witnessed in the UAE and the Middle East.
The Bitcoin MENA event in Abu Dhabi. Source: Cointelegraph
A “springboard” for crypto adoption
Vranjes described the UAE as a launchpad for blockchain projects, citing its regulatory clarity compared to other jurisdictions. “Our expectation for this market is that it’s going to move much faster,” he said. “This market’s going to leapfrog ahead in global rankings really quickly.”
Vranjes said that the country has been able to attract the right talent, highlighting the influx of talent relocating from London, India and the Asia-Pacific region.
“When you get the right people, the right companies and the right regulatory framework, this is the combination for success,” Vranjes added.
Shariah-compliant crypto services
The demand for Shariah-compliant crypto services is another significant trend, particularly for decentralized finance (DeFi). Islamic finance prohibits interest-based lending, focusing on profit-sharing agreements. Lenders and borrowers share investment risks, and both parties share their losses and profits.
Bendjemil said Shariah compliance is “one of the most important narratives at the moment for the Middle East,” not just for Bitcoin (BTC) but also for DeFi. The Core DAO executive said it opens up possibilities for Muslim community members:
“Shariah compliance will unlock many possibilities for a lot of people in the Islamic world, and probably beyond that because projects are about to be ethically aligned.”
Bendjemil said this was a “recurring demand” in the Middle East and that many builders are already crafting solid strategies for complying with Shariah law.
In September, Bybit introduced a Shariah-compliant crypto account, catering to investors seeking alignment with Islamic law.
Products and services in Islamic finance. Source: Cointelegraph
Related: Bitcoin MENA 2024: Core DAO talks DeFi growth, blockchain security
Dirham stablecoins and making Bitcoin legal tender
Zurawinski pointed to the potential impact of dirham-pegged stablecoins, which could strengthen the UAE’s local payment infrastructure.
On Oct. 18, a stablecoin issuer received an initial nod from the country’s central bank for a potential stablecoin pegged to the UAE dirham. Zurawinski said, “It just shows also the focus on the local payment method, which is basically a dirham, unlike the US dollar or Bitcoin being a legal tender.”
Zurawinski said it might take some time for the country to adopt Bitcoin as a recognized means of payment. However, this doesn’t ignore the fact that the UAE is “setting up an example of how innovation should look like,” he added.
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