Chief Technology Officer of IBM a blockchain, AI expert joins Saudi Central Bank

Chief Technology Officer of IBM a blockchain, AI expert joins Saudi Central Bank

Anthony Butler, the Chief Technology Officer for IBM MENA region who was based out of KSA, and is a blockchain, AI, metaverse expert has joined Saudi Central Bank (SAMA) as a senior advisor.

He announced the new position on LinkedIn saying, “I’m happy to share that I’m starting a new position as Senior Advisor at Saudi Central Bank – SAMA! As a senior advisor to SAMA I will be focused on  first of a kind applications of emerging technology, such as artificial intelligence, distributed ledger technologies, quantum, and advanced cryptography in support of payments innovations (such as CBDC, stable coins, and tokenization), transformation of Suptech/Regtech, green finance,  open finance, decentralized finance (DeFi), and cybersecurity.

Anthony Butler had spent 15 years as chief technology officer for IBM in the Middle East and Africa working in emerging technologies, with a specific focus on the application of artificial intelligence, blockchain and metaverse technologies.

Anthony is well versed speaker and writer on emerging technologies. On his Blog page he talked about the impact of emerging technologies, such as blockchain and artificial intelligence, on societies and economies. 

He also notes on his page, that he lives in and supports the development of one of the most exciting and future-oriented places in the world, the Kingdom of Saudi Arabia. 

In one of his articles he discusses the collapse of FTX currency exchange, and believes there is a need to evolve new models of decentralized finance that will mitigate risks. He adds that if a person does not own their keys they cannot own their digital tokens.

He notes, “Decentralized Finance (DeFi) is likely to hold the long term answer to much of this: decentralized exchanges will use blockchain technologies to remove the need for trust.  They will provide permissionless, transparent, exchange services where users will have self-sovereign custody of their digital assets without the need to transfer control to a centralized authority to manage on their behalf.”

Anthony Butler had also been involved in KSA Central Bank’s ABER CBDC project with the UAE Central Bank. At the time he noted in a tweet, “What is new and challenging is we are designing it so that it can be issued by two central banks simultaneously.  Many hard problems being solved and lots of lessons to be learned but exciting times ahead; and great example of the visionary leadership of both @SAMA_GOV and CBUAE.”

This is not the first major appointment of an expert in the digital asset, blockchain space by SAMA, prior to this they had appointed Mr. Mohsen AlZahrani, Virtual Assets (VA) and CBDC program Lead, who was recently discussing KSA’s wholesale CBDC project at R3 Corda Day in UAE.

Central Bank of Saudi Arabia and UAE choose R3 Corda for CBDC sandbox pilots

Central Bank of Saudi Arabia and UAE choose R3 Corda for CBDC sandbox pilots

During Corda Day Middle East held on May 11th 2023 in Dubai UAE, speakers from the Central Bank of Saudi Arabia (SAMA) as well as the Central Bank of UAE discussed their CBDC strategies and pilots. Both Central Banks are working with R3 Corda on their CBDC pilot programs, SAMA in its sandbox and UAE Central Bank in their research and development center.

The event as per R3, brought together financial service leaders, technologists and Corda enthusiasts from around the region and the globe. Of the prominent speakers included H.E. Saif Humaid Hamad Al Dhaheri, Assistant Governor – Strategy, Financial Infrastructure and Digital Transformation, Central Bank of UAE and Mr. Mohsen AlZahrani, Virtual Assets (VA) and CBDC program Lead, Saudi Central Bank – SAMA as well as Richard G Brown, Chief Technology Officer, R3.

Al Dhaheri made a keynote address on “Future of Money, CBDC and the Digital Dirham” while AlZahrani carried out the closing Keynote, on the topic of “Wholesale CBDC”

Mohsin AlZahrani told Lara on the Block, “Currently we are working with R3 Corda only for the sandbox experimentation, we have not yet decided on the next phase platform or implementation.”

Farhan Khan, Chief Technology Officer Consultant and advisor in Fintech and Blockchain, who attended the event representing Cykube, spoke to Lara on the Block explaining what he learned about CBDC implementation in UAE and KSA.

Khan explained, “It was an excellent event and very eye opening on how R3 is properly working in the region. What I learned about the CBDC implementation in KSA and UAE is that both are working with R3 but each country has a different approach. Saudi Arabia is working on a wholesale CBDC project for its domestic payment system, while UAE Central Bank is working on CBDC for cross border payments.”

Khan adds, “For example the ABER cross border payment project which was paused might be reutilized in the future as per AlZahrani’s statements at the event. AlZahrani stated that SAMA is utilizing the experience of ABER during the implementation of the CBDC wholesale payment system concept, and there is a chance in the future to use ABER again between KSA and UAE after the experimentation of CBDC wholesale in KSA is completed.”

According to Khan the UAE is working on a prototype with R3 Corda for the digital dirham which is currently under testing in their R&D facility.  

Khan concludes to Lara on the Block saying that R3 Corda has seen a lot of interest because it has very powerful features such as interoperability between blockchain platforms even public ones. He explains, “Fintech entities in both Saudi Arabi and UAE are waiting for the network gates to open, and with the VARA crypto regulations cooking every day we feel the same will be happening in KSA. Corda is the right framework from a technology perspective with its tremendous security, protection, especially when it comes to digitization and tokenization.”

This is reflected in a post by R3’s Chief Technology Officer Richard Brown who states, “Composability and interoperability are critical cogs in the architecture of Corda. With the next generation of Corda, there’s no need to decide on your network model at the outset of a project. Start with a centralized, private network and gradually decentralize over time!”

Brown believes that the success of Corda is because it is a cross-firm shared ledger enabling collaborating parties to transact based on high quality data, without exposing internal data or systems, and with far fewer reconciliation errors. A ledger that could even become the industry’s system of record for some key questions such as ownership of assets (the terms ‘Digital Assets’ and ‘Tokenization’

It is also a permissioning system that provides high identity assurance and gives confidence to regulated entities that they can comply with their legal obligations to know with whom they are transacting. In addition is a  privacy-first design, allowing competitors to trade without revealing sensitive data publicly – only participants in a transaction get to see the details – unlike other blockchain-inspired approaches.

He even goes so far to say that, “We’ve been delighted by how successful Corda has been, far beyond the narrow banking scenarios we originally designed it for. Broadly speaking, we’re seeing it being used to solve four main problems in ‘Regulated DeFi’:”

UAE Emirates NBD bank partners with PWC and digital asset custodian FireBlocks

UAE Emirates NBD bank partners with PWC and digital asset custodian FireBlocks

UAE Emirates NBD Bank announced on LinkedIn that it has partnered with PWC and digital asset custodian and settlement provider FireBlocks to launch its Digital Asset Lab. PWC Middle East and Fireblocks will be founding council members.

According to Emirates NBD, “This marks a new milestone in our innovation journey, and together, we look forward to shaping the Digital Asset space in the region.”

Fireblocks is an enterprise-grade platform delivering secure infrastructure for moving, storing, and issuing digital assets. The company enables businesses to easily and securely support digital assets and cryptocurrencies.

In February of 2023, Fireblocks acquired First Digital, a stablecoin and digital asset payments technology platform for $100 million.

UAE based Emirates NBD has been a strong proponent for Blockchain and digitization. Emirates NBD was one of the first banks to join the UAE blockchain enabled KYC platform.

In 2022 UAE Emirates NBD Group Chief Operating Officer Abdulla Qassem, stated, “It is only a matter of time before Blockchain technology rises to the forefront in the UAE and we begin to acknowledge crypto and digital assets as valid currencies. He made this statement during a panel session at the Global Business Forum Latin America (GBF LATAM 2022).

Could this be the beginning of crypto transactions and wallets at Emirates NBD, we will just have to wait and see.

MENA open banking platform Tarabut gateway raises $32 million to expand in KSA

MENA open banking platform Tarabut gateway raises $32 million to expand in KSA

MENA based Tarabut open banking platform, which recently signed its first partnership with a crypto brokerage exchange RAIN in Bahrain, has raised $32 million in its series A, led by Pinnacle Capital. The funds will be used to bolster Tarabut’s footprint in Saudi Arabia.

Pinnacle Capital is a leading alternative investment firm that focuses on KSA investments to provide unique alternative investment opportunities. Pinnacle Capital partners have extensive transactional experience in the venture capital industry with a proven track record, including leading the first Saudi unicorn tech startup, Jahez, to a public listing. The raise also saw participation from Aljazira Capital, Visa, Tiger Global, and other leading existing investors.

Abdulla Almoayed, Founder and CEO of Tarabut Gateway, stated, “Open banking is reshaping the financial landscape in KSA and the wider Middle East, and we, at Tarabut Gateway, are proud to be at the forefront of this innovation. This fundraise reflects the potential of open banking, our advanced technology, and the trust placed in us by our partners both in KSA and globally. Tarabut Gateway’s mission is to create an open financial services sector that delivers open banking benefits to MENA’s consumers, banks, and fintechs – and the proceeds of this fundraise will help us execute our strategy and contribute to realizing the Kingdom of Saudi Arabia’s ambitious vision 2030.”

In KSA, Tarabut Gateway has achieved over 60% market coverage through partnerships with leading banks such as Alinma Bank, Arab National Bank, Saudi National Bank and Riyad Bank. The Saudi Central Bank (SAMA) has included Tarabut Gateway as one of the first participants in its Regulatory Sandbox, which is a key component of the open banking framework rollout.

Tarabut Gateway will also be partnering with Visa. Andrew Torre, Regional President of Visa CEMEA, said, “Next-generation digital experiences and innovation are driving the future of financial services, and open banking is a growing movement that can help consumers better access and manage finances. We look forward to partnering with Tarabut Gateway, combining our global payments network and proven local solutions with their open banking platform to allow innovative financial services across the region.”

Abdulwahab Al Betairi, Founding Partner of Pinnacle Capital, added, “We’re thrilled to be backing Tarabut Gateway’s ambitious growth plans. Their innovative approach to open banking and their strong focus on Saudi Arabia make them a perfect partner for us, and we’re excited to see them grow to new heights and contribute to the growth of the Saudi Arabian fintech space as part of the Vision 2030 strategy.” 

Prior to this announcement, Tarabut Gateway partnered with Rain. As per the announcement it would brig faster, cost effective fiat to crypto transaction to Bahrain end users and enable funding payments directly from user bank accounts without leaving Rain’s platform.

The new feature will utilize Tarabut Gateway’s open banking payment solutions to facilitate on and off-ramp (fiat-crypto-fiat) transfers for users, dramatically increasing speed and reducing errors associated with traditional bank wire transfers.

Abdulla Almoayed, Founder and CEO of Tarabut Gateway, stated at the time that crypto trading, crypto wallets and other blockchain use cases were a natural ally in opening up traditional banking and finance. He stated, “We’re delighted to unveil a solution that aims to make fiat-to-crypto transfers quicker, more secure, and cost-effective – as well as enable such funding methods directly from bank accounts. We are proud to partner with Rain to provide a user-focused approach to crypto services by bringing the advantages of open banking digital solutions.”

Blockchain Integration Cloud platform launched in MENA region

Blockchain Integration Cloud platform launched in MENA region

Blockchain compatible EVM ( Ethereum Virtual Machine) platform built on NEAR protocol, Aurora Labs, with offices in Business Bay in Duba, has launched its Aurora Cloud in the MENA region.

The platform is designed to integrate blockchain technology to their business without friction or the need for expert teams, significant resources, or large investments in time. With Aurora Cloud, businesses can connect their existing products to their own blockchain, allowing for a seamless end user experience that still looks familiar to what their customers use every day.

The platform enables businesses to choose to operate on their own private blockchain, known as an Aurora Silo, implementing KYC/KYB access restrictions and dictating which apps and tokens are available to trade and use, allowing for a bespoke and tailored experience. The ability to control whether they or their customers are responsible for gas fees is another game-changing feature that provides total commercial flexibility and a strong incentive to both businesses and their consumers.

Whilst Aurora Cloud is largely an industry agnostic solution that can provide blockchain benefits across a wide range of industries, the company sees significant benefits for Fintech companies, brokers, banks, investment funds, the energy sector, and those operating within the luxury goods and retail spaces.

“The launch of Aurora Cloud is an exciting moment for Aurora Labs and the wider blockchain industry. With our unique products and innovative approach, we are breaking down the technical barriers and increasing the transition of traditional businesses to the blockchain,” said Alex Shevchenko the CEO of Aurora Labs. “We are confident that Aurora Cloud will position us at the forefront of this shift and provide the industry with a much wider pool of potential customers and partners.”

Aurora raised $12 million in October of 2021. 

R3 to design and Build UAE’s CBDC as well as tokenize financial and non financial activities

R3 to design and Build UAE’s CBDC as well as tokenize financial and non financial activities

R3 was chosen by UAE Central Bank as its technology partner to design and build a CBDC for the first phase of the central bank’s CBDC project because it is a permissioned based DLT (Distributed Ledger Technology) that decentralize assets privately and works well in regulated industries, but more importantly is its interoperability and asset fluidity. R3 will not only assist UAE’s Central Bank in developing a CBDC but also in tokenizing financial and non-financial activities, in addition to the digitalization of other financial services. 

R3 offers interoperable CBDC solution

LaraontheBlock interviewed R3 to learn more about their role in UAE’s CBDC project.  Alisa DiCaprio, Chief Economist at R3 when asked why R3 was chosen and not another Blockchain technology provider replied, “R3’s Corda is the world’s leading permissioned distributed application platform and is specifically designed to work in highly regulated environments with today’s financial services industry. Corda powers solutions that decentralize assets while maintaining privacy and regulatory oversight, making it a favored technology for central banks looking to issue CBDCs.”

She added, “Its interoperability and asset fluidity means that central banks can move digital currencies openly and freely across network boundaries, using well-defined trusted exchange protocols that meet regulatory demands for privacy and security.” 

This is not the first CBDC project that R3 has participated in. DiCaprio explains, “ R3 has been chosen as the technology partner for numerous CBDC projects, including: Digital Tenge, where the National Bank of Kazakhstan is currently leveraging R3’s Corda for Digital Tenge CBDC project, to test the concept’s feasibility and determine the main parameters of the digital currency model. The Digital Tenge platform recently underwent successful testing with real consumers and merchants in cooperation with market participants. The DT’s entire life cycle (including the programmability and demonstration of the offline transactions chain) was tested.” 

Another project being worked on by R3 is Project Icebreaker, The Bank for International Settlements and the central banks of Israel, Norway and Sweden concluded Project Icebreaker this month, which studied the potential benefits and challenges of using retail CBDCs in international payments. 

According to DiCaprio CBDCs can strengthen financial market infrastructures in several ways. She explains, “CDBCs offer more efficient cross-border payments, faster settlement time periods and the streamlining of multi-party processes, so we’re excited to continue supporting central banks as their respective CBDC journeys.” 

As for why R3 was chosen, one of the most important reasons was the ability to facilitate interoperability and the exchange of data and assets across networks. As per DiCaprio, the platform is exploring ways to act as a bridge to various other platforms outside of the Corda ecosystem. This enables assets to move freely across networks while still maintaining privacy in the decentralization process. 

For Dicaprio interoperability is a critical development and a core focus at R3 to increase reach for users’ assets, minimizing friction with no sacrifice to safety. She adds, “By achieving this, we will be able to connect with other DLT players to provide the most seamless experience for our customers.” 

DiCaprio adds that R3 has seen a growing interest in CBDCs in the region given the region’s rising stature as a global fintech hub. This was appreciated during their partnership with UAE Central Bank. She stated to LaraontheBlock, “We look forward to seeing central banks across the world continue to explore and develop CBDCs and realizing the benefits they can bring to our financial ecosystem.”

R3 readies UAE for Tokenization

The Central Bank of UAE announced on March 23rd 2023 that it had commenced the implementation of its CBDC strategy in partnership with technology entities, UAE based G42 Cloud and Blockchain global solution provider R3. R3 then followed this with its own press release on April 4th 2023 explaining on the UAE Central Bank CBDC project including as well Clifford Chance who will be providing critical legal oversight for the strategy.

R3 in their press release stated that R3’s technological support will enable the Central Bank of UAE to ensure the readiness of the UAE for the potential future tokenization of financial and non-financial activities, in addition to the digitalization of other financial services.

Digitization in UAE

Parties that will be working with the UAE Central Bank CBDC project all agree that the project is part of a wider strategy for digitization in the UAE.

David E. Rutter, CEO at R3, commented, “This is another landmark moment in bringing CBDCs even closer to production and issuance. CBDCs can strengthen our financial market infrastructure in several ways, including more efficient cross-border payments, faster settlement time periods and the streamlining of multi-party processes. The CBUAE has made a significant step forward in realizing these benefits. We are honored and excited that R3 has been selected to design and build CBUAE’s CBDC ecosystem in this innovative move towards building a more open, trusted, and enduring digital economy. We look forward to supporting the CBUAE in the next stage of its CBDC journey.” 

While Talal Al Kaissi, CEO at G42 Cloud, stated, “We’re thrilled to be supporting the CBUAE in the development of its digital dirham. This collaboration represents an important milestone in the digitalization of the UAE’s monetary and payments framework and ensuring that the country remains at the forefront of financial services innovation. As a company founded in the UAE, we have seen first-hand the country’s rapidly advancing status as a global fintech hub and are excited to be working with the CBUAE in leading its digital transformation. We look forward to working with the Central Bank and R3 to deliver a cutting-edge CBDC infrastructure that meets the highest standards of efficiency, security, and innovation.”

While Jack Hardman, Partner at Clifford Chance and Head of Fintech in the Middle East added, “As CBDC development moves from research to real-life building, it is vital that central banks are aware of the legal implications of any chosen design feature or strategy, in addition to how this emerging technology interacts with existing regulations. Clifford Chance has an established track record as a leading advisor in the fields of financial services and technology, and we look forward to working with the CBUAE on its CBDC implementation strategy.”

As per UAE Central Bank, the first phase of the CBDC strategy will be completed within the next 15 months. It will include a soft launch of MBridge to facilitate real value cross border CBDC transactions for international trade settlement, proof-of- concept work for bilateral CBDC bridges with India, one of the UAE’s top trading partners and finally, proof-of-concept work for domestic CBDC issuance covering wholesale and retail usage.

The UAE Central Bank views the UAE CBDC as able to address the pain points of domestic and cross-border payments enhance financial inclusion and the move towards a cashless society. It will further strengthen the UAE’s payment infrastructure, providing additional robust payment channels, ensuring a resilient and reliable financial system. More importantly, the CBUAE aims to ensure the readiness of the UAE to integrate the payment infrastructures with the future potential tokenization world, the tokenization of the financial and non-financial activities. 

H.E. Khaled Mohamed Balama, the Governor of the CBUAE, stated at the time, “CBDC is one of the initiatives as part of the CBUAE’s FIT program, which will further position and solidify the UAE as a leading global financial hub. The launch of our CBDC strategy marks a key step in the evolution of money and payments in the country. CBDC will accelerate our digitalization journey and promote financial inclusion. We look forward to exploring the opportunities that CBDC will bring to the wider economy and society.” 

The Central Bank of UAE stated that it was now ready to enter into the next major milestone of its CBDC journey after several successful CBDC initiatives including project Aber with Saudi Central Bank in 2020, and the accomplishment of the first real-value cross-border CBDC pilot under the “mBridge” Project with the Hong Kong Monetary Authority, the Bank of Thailand, the Digital Currency Institute of the People’s Bank of China and the Bank for International Settlements in 2022.

Kuwait Banks implement Blockchain KYC Solution while its Central Bank studies CBDC

Kuwait Banks implement Blockchain KYC Solution while its Central Bank studies CBDC

Governor of Central Bank of Kuwait Basel Al Haroon in an interview with John Everington from the Banker, discussed the implementation of Blockchain EKYC solution as well as the ongoing research for CBDCs.

According to the governor of Kuwait’s Central Bank, the bank is closely following the experiences of other countries that are issuing CBDCs, as well as the debates taking place among stakeholders in various countries regarding the various pros and cons.  He tells the Banker that they have formed a team of experts from various fields within the CBK to study the topic. According to Al Haroon, any such issuance would need to be accomplished in a way that preserves monetary and financial stability, while maintaining confidence in Kuwait’s payment system.

In addition when it comes to blockchain, two local Kuwait banks have obtained the Central Bank’s approval to launch their blockchain based KYC verification and API interfaces.

In June 2021, Akcess which utilizes Hyperledger Fabric to provide KYC Blockchain enabled solution to customers in Egypt, Kuwait, Qatar and UAE opened its offices in Kuwait as it currently had projects underway in Kuwait, Egypt, UAE and Qatar.

In the announcement CEO Abouzeid stated, “With a team of over 30 developers spread across London, Romania, and Moldova, Our global blockchain platform is AKcessChain, built on Hyperledger Fabric, and we launched the private blockchain network globally and in Kuwait,” Abouzeid says. “We currently have nodes in the UK, Switzerland, and Canada, and have configured nodes in Kuwait, one for each of our large clients. The Kuwait network is being used by top financial institutions for onboarding clients, verifying and updating KYC profiles, as well as managing transactions. We are now in advanced talks with financial institutions in the UAE and Saudi Arabia, and are also preparing for our expansion into the GCC market.”

UAE based WadzPay blockchain payment provider launches its 2.0 version built on Algorand blockchain

UAE based WadzPay blockchain payment provider launches its 2.0 version built on Algorand blockchain

UAE based WadzPay, an interoperable blockchain-based technology provider, has launched the WadzPay 2.0 which it believes will redefine the landscape of virtual asset-based transactions. WadzPay 2.0 provides a unique new architecture primarily based on the Algorand blockchain with inbuilt support for several others such as Ethereum, Tron, Avalanche and several others to be added. WadzPay 2.0 construct is designed in line with evolving regulations and needs of banks, financial institutions, telcos and central banks.

Anish Jain, founder and group CEO of WadzPay, stated, “Blockchain is already disrupting global finance, and with WadzPay 2.0, we are bringing a slew of capabilities that will transform digital currency payments. This enhanced product line encompasses issuance, acquiring, remittance, central bank digital currency (CBDC) and tokenization, providing a true one-stop solution for the industry. This is a leap forward in the blockchain payments ecosystem. WadzPay customers can rest assured of an elevated experience for its end users.”

Designed with an API-first approach, a robust compliance framework and customer-friendly dashboards, it enables payments in the metaverse, point of sale, in-app, e-commerce, etc. It also serves as the foundation for the future launch of the WadzPay Chain. It leverages the Algorand blockchain for transaction processing, standard assets for on-chain storage of funds, and a ledger for wallet management and bookkeeping. The platform also incorporates Gap 600’s expertise to manage transaction finality for Bitcoin and Ether -based transactions, and Bosonic to convert funds at the point of sale (POS).

WadzPay 2.0 boasts several integration options and features such as:

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E-Know Your Customer (KYC) solution with biometric verification for seamless user onboarding

Real-time fraud detection, customer screening and transaction monitoring

Multisignature custodial wallet with multiple-level hierarchy and password management

Internal and external wallet transfers

Push/pull payment options with transaction notifications

Customized reports in various formats

Issuer and merchant dashboard with seven layers of hierarchy control

Multicurrency acceptance at POS terminals and e-commerce portals with QR code support

Settlement in digital or fiat currency of choice, based on market regulation

On-chain refunds, including multiple refunds on a single transaction

Inbuilt volatility management solutions

Improved transaction speeds on Ethereum and Bitcoin blockchains

Blockchain UAE Trade Finance platform adds United Arab Bank as 11th bank on its platform

Blockchain UAE Trade Finance platform adds United Arab Bank as 11th bank on its platform

Blockchain UAE Trade Connect platform, the UAE’s first trade finance platform to combat fraud has added United Arab Bank (UAB) as its 11th bank on its platform.

UTC, the fintech blockchain platform of e& enterprise, is the UAE’s first commercialized solution to combat fraud in the trade finance space built on advanced technologies, namely blockchain and Artificial Intelligence (AI). UTC is a collaborative project of the banking industry and co-created with e& enterprise.

UAE Trade Connect is a cloud-native solution that detects suspicious transactions, prevents fraud and duplication, and supports a wide range of trade-related documents that is validated and inspected in real time.

Shirish Bhide, Chief Executive Officer at United Arab Bank, stated, “We wholeheartedly support UTC’s mission of driving digital transformation and reducing fraud risks. This strategic partnership aligns with UAB’s mission to accelerate growth through digitization and to build a secure and transparent trade finance ecosystem. UTC’s benefits will not only protect UAB’s customers and the wider banking system but will also boost global trade. It is a pivotal event in the digitization space, with the potential to make trade financing more accessible, affordable, and equitable.”

 Zulqarnain Javaid, Chief Executive Officer of UTC, added, “We are excited to welcome United Arab Bank to our banking consortium – UAB joins us as a full member along with 10 other UAE banks. All consortium members play an equal and active role in the steering and governance of the UTC platform. Since our launch in April 2021, UTC has inspected transactions worth close to AED 100 billion in real time. This achievement is aligned with the UAE government’s vision to bring the best in technology building a competitive economy and stepping up the digital transformation process to enter into the new digital banking era.”

With the advent of the Invoice Factoring law recently published by the Federal Government of the UAE, the UTC blockchain platform will be a key enabler for banks to increase lending to SMEs and allow corporates to borrow against their trade receivables.

In December 2021, the UAE Blockchain AI enabled UAE Trade Connect trade finance platform which was built by Etisalat and Blockchain solution provider Avanza Innovations, had processed 10 Billion AED (2.7 billion USD) worth of invoices during the first eight months of its operation. Etisalat Digital launched UTC trade Finance platform in April of 2021 alongside seven banks within the UAE.

In early 2022, Abu Dhabi Commercial Bank joined UTC platform as did Dubai Islamic Bank. At that time UTC had in total nine banks on its roster. The founding banks included First Abu Dhabi Bank (FAB), RAKBANK, Emirates NBD, Commercial Bank of Dubai, National Bank of Fujairah, Mashreq Bank, ADIB – Abu Dhabi Islamic Bank, and Commercial Bank International.

The Crypto ecosystem grows in Bahrain after entrance of Binance

The Crypto ecosystem grows in Bahrain after entrance of Binance

In January 2023 Binance celebrated its official entrance into Bahrain. Bahrain’s crypto ecosystem has flourished with the entrance of Binance. Bahrain has witnessed a growth on all fronts, crypto exchange users, crypto payments, crypto jobs and competitive crypto offerings. Binance received its official license in October 2022.

Growth of crypto exchange users

The official license and launch of Binance in Bahrain has added to Binance’s crypto exchange users.

Binance announced that it witnessed a 34% growth in institutional business clients in MENA in Q4 2022, the highest growth for a region where Binance operates, Nadeem Ladki, Executive Director Head of BD & Partnerships, Europe & MENA at Binance told LaraontheBlock, “While I cannot go into the specific growth in Bahrain, I can confirm that we have seen a growth in users since we officially launched in October 2022.”

Even Bahrain based CoinMENA; crypto broker also saw an increase in its user base in 2022 including the period since Binance made its foray into the country. Talal Tabaa CEO and Founder of CoinMENA explained to LaraontheBlock, “Year on Year from December 2021 until December 2022, the verified users of CoinMENA from Bahrain grew by 143 percent. In specific since the entrance of Binance in October 2022, CoinMENA witnessed 5.6 percent growth up until January 2023.”

Growth Crypto vis vie Banking services

In addition to the increase in the number of newly on boarded crypto exchange clients, the country has seen more robust competitive marketing campaigns, with lower fees aimed at attracting a bigger user base as well as enhanced banking crypto relationships.

Binance holds a Category 4 license as a crypto asset service provider (CASP) and was the first exchange in the country to be granted a category four license.  This meant that users could access Binance’s full range of crypto asset exchange services, including direct deposits and withdrawals in local currencies.

Yet this did not faze CoinMENA which despite being a crypto broker still espouses good relationships with liquidity partners and banks. Talal Tabbaa, CEO of CoinMENA told LaraontheBlock, “Compared to other regions, the MENA market is one of the smallest. CoinMENA, Rain & BitOasis are technically all brokerage firms. We all have to work with global liquidity partners to place trades on behalf of our users. CoinMENA can list tokens at its own discretion following the Board of Directors’ approval, but they must comply with CBB guidelines.”

After Binance entered Bahrain and in early 2023, CoinMENA announced that users could now easily deposit and withdraw crypto through bank transfers or cards in just 24 hours. CoinMENA CEO explains, “We maintain good banking relationships which is crucial to ensure the on-ramp and off-ramp services are as frictionless as possible for our users.”

RAIN crypto broker which similar to CoinMENA has a category three license in Bahrain has on some occasions compared its offering with Binance. In a tweet by one of its founders AJ Nelson in late October in reply to a comment from a client stated, “Yes we are well aware of the problems with bank transfers. We are working directly with regulators to solve. In good time we will have a solution regarding fees, have you used Rain Pro? It has 0 maker fees and tight spreads. Lower fees and pricing than Binance.”

More Competitive Marketing Campaigns lower fees

In terms of marketing campaigns to introduce better services at lower cost, Binance for its launch campaign offered 25% discount on all trading fees for Bahrain users through a link ‘ BHLive’. 

In addition Binance offered the Binance Bahrain Card allowing Bahrain clients to spend cryptocurrencies in over 60 million online and physical stores. 

Furthermore in December as part of its Christmas offering, Binance offered its Arabic speaking clients’ rewards reaching $1.5 million in addition to promotions. As it noted on its twitter page Binance offers 350+ crypto assets with fees of less than 0.10 percent per transaction. 

CoinMENA quickly countered these marketing campaigns with those of its own. For example in January 2023, CoinMENA offered discounted card deposit fees for 48 hours again after doing so in late 2022.

 As per the advert, users would pay only 2% fee on card deposits instead of 3.5%. For Bahrain’s National Day celebrations, CoinMENA offered zero trading fees for a limited time of 48 hours. The crypto exchange had also promoted prior to that a 23% off on trading fees for a specified time period.

 CoinMENA offers around 30 crypto assets for trading with fees of 0.75%.

 Tabaa confirms that the entrance of Binance helped to grow the crypto ecosystem in Bahrain. He stated, “Binance spends a lot on crypto marketing and this actually benefits the entire ecosystem of players.”

 Growth of Crypto Payments

Crypto as a method of payment has also seen significant growth since the entrance of Binance in Bahrain. Binance partnered with EazyPay, a financial payment service provider which has a network of thousands of merchants and over 6000 terminals, to offer crypto as a method of payment while settling transactions with merchants in fiat currency.

According to Nayef Tawfiq Al Alawi, Managing Director and CEO of EazyPay, “As a regulated entity we can only work with regulated entities such as Binance. Since our partnership merchants have been more confident to get into the crypto payment scene and in terms of transactions, while people are still testing the service on average we transact $5000 worth of crypto transaction per day over 6000 terminals in Bahrain. This is really good.”

It hasn’t stopped there, In November 2022 just after Binance entered Bahrain, CoinMENA partnered with Carlton Real Estate, a Bahrain-based real estate agency that allows investors in the Kingdom to purchase real estate property using crypto assets. Under the partnership, the real estate broker would accept stablecoins like USDT and USDC.

 This only exemplifies the increase in crypto as a method of payment in the country.

Growth in crypto Job market

Binance has viewed Bahrain as a key business hub which will provide areas for growth and employment within the wider industry. Currently Binance has employed 200 people in Bahrain and is continuing to hire. It has job posts for Customer Support Specialist, Senior Treasury Manager and others in Bahrain.

Even RAIN which decreased its employee base by 50% still has around 200 employees while CoinMENA has around16 employees and is also currently hiring with job openings for software engineer in January 2023 as well others.

Conclusion

Changpeng Zhao CZ in a recent tweet  stated, “Bahrain is a hidden gem, super safe, very clean, well developed, good food, superb service, nice people and crypto friendly!”

While CoinMENA affirms that it has known that international players would be entering the region given the poor financial services, high fees and large unbanked population coupled with young demographic population and high smartphone penetration. To him this only shows the market is maturing and accelerating growth.

Binance in 2022, processed a whopping $65 billion in trading volume on average every day, at a speed of approximately 0.7 million transactions per second. The entrance of Binance into markets such as Bahrain has for sure added to the growth of the crypto market and ecosystem.