Dubai, the largest and most wealthy city in the United Arab Emirates (UAE), will have its own cryptocurrency.
The new cryptocurrency, emCash, is the result of a partnership between Emcredit, a subsidiary of Dubai Economy, and Object Tech Group Ltd, a UK-based blockchain startup. According to Ali Ibrahim, Deputy Director General of Dubai Economy, emCash will be based in the latest blockchain technology and be used “for various government and non-government services, from their daily coffee and children’s school fee to utility charges and money transfers.”
Emcredit will be responsible for launching emCash and creating a dedicated wallet, emPay. The company is designing emCash to support contactless payments between Dubai citizens, using near-field communication (NFC) protocols, along with solutions for mobile devices.
In the future, there are plans to enable peer-to-peer lending as well as record credit ratings for the blockchain-based currency. Although still unknown, there is a strong probability that emCash blockchain will be private, given that distributed systems cannot be controlled or watched by the government. Emcredit CEO, Muna Al Qassab, comments:
“Customers can choose between two payment options on the emPay platform – the existing dirham payment or emCash. While the dirham payment goes through normal settlement procedures, intermediaries and costs, emCash payments are settled directly between the user and merchant. emCash thus gives real time value movement and merchants can pass the cost benefit to the emCash holder.”
Dubai and Blockchain
News of Dubai adopting their own cryptocurrency might not come as a big surprise to some of the readers. Dubai is so fond of cryptocurrencies that its crown prince, Sheikh Hamdan bin Mohammed bin Rashid Al Maktoum, plans to make Dubai the first Blockchain-powered city by 2020.
Many sectors have already started adopting blockchain in order to make this plan a reality. Dubai’s biggest bank, Emirates NBD, will introduce blockchain technology into cheques until the end of the year in order to minimize fraud. Object Tech Group was also assigned to created digital passports to be used at the Dubai International Airport, creating the world’s first “gateless border”. Even the real estate market has adopted blockchain and you can now buy luxury properties with bitcoin.
And now, if all goes as planned, Dubai will become the first to adopt a national cryptocurrency. Seeing as emCash is still in an embrionary stage, it is uncertain how it will be implemented into society. If they decide to create a private blockchain, it might lose some of the benefits of having a decentralized system, like privacy and lack of censorship. But one thing is certain, Dubai is a pioneer financial technology hub and is establishing itself as the blockchain world capital.