Over the past five years something extraordinary has happened in blockchain. Countries usually known for following tech innovation have taken leadership roles. Instead of normal stalwarts like the U.S. at the helm, many Middle Eastern countries are leading the way. According to Michael O’Loughlin. What do they have in common? Friendly regulation.
This week the Saudi Arabian Monetary Authority (SAMA) announced that it used blockchain technology to deposit a part of the liquidity to be injected into the banking sector. This move acts as part of SAMA’s active role in providing much-needed credit facilities.
SAMA is a prime example of an innovative regulator willing to experiment with new emerging technologies. By assessing the multiple use cases and benefits of blockchain, SAMA ensures the Kingdom keeps apace with global market trends. While fintech is on the rise across the region, this new money transfer via blockchain by the central bank will no doubt shine the much-deserved spotlight on fintech in Saudi Arabia. The rapidly growing Saudi fintech community have been given several boost over the past 12 months, including the SAMA Regulatory Sandbox, new digital banking services and blockchain education programs.
Just a short hop, skip and a jump away, the Bahrain Economic Development Board endorsed blockchain technology. This isn’t hot off the press, this occurred in October 2017. This small island is a true economic and innovation pioneer, not just for the region, but for the world. Bahrain regulators acted quickly to introduce new crypto-asset regulation and work closely with the financial services industry and government to entice blockchain talent from across the globe. By undertaking numerous initiatives to attract blockchain talent, Bahrain is establishing itself as a blockchain pioneer in the region. Bahrain also launched a regulatory sandbox to attract blockchain startups and more established players. Keeping the blockchain momentum going, the University of Bahrain now issues digital diplomas on the blockchain.
The UAE too has been very active in both the crypto and blockchain space, with numerous investments and complimentary crypto regulations. What is abundantly clear is that these countries; Saudi Arabia, Bahrain and UAE are blockchain champions of progress and innovation. Global regulators should take note.