UAE’s Apex Bank Unveils Start of its CBDC Strategy

The United Arab Emirates (UAE), a country located in Western Asia has announced its strategy for the launch of its Central Bank Digital Currency (CBDC). According to the announcement, the country anticipates the completion of the first phase of the digital Dirham by the middle of next year.

Based on its current plans, the Central Bank of UAE has contracted with G42 Cloud, a cloud storage platform, and R3, a New York-based blockchain firm as infrastructure and technology providers for its CBDC implementation. The first phase comprises three significant bridges. The first bridge is the soft launch of mBridge to enable international CBDC transactions.

The second bridge is the 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 for wholesale and retail customers.

More crucially, the Central Bank intends to make sure that the UAE is prepared to connect its payment infrastructure with a future in which both financial and non-financial activity may be tokenized.

Notably, the UAE completed the first and largest wholesale trial using Central Bank Digital Currencies (CBDC) for international trade. Some of the program’s contributors include the Hong Kong Monetary Authority, the Bank of Thailand, and the Bank for International Settlements.

UAE Adopts Crypto

In recent years, the United Arab Emirates (UAE) has made great strides toward adopting cryptocurrencies and blockchain technology. In January, Thani Al-Zeyoudi, the UAE’s minister of state for foreign trade, stated that cryptocurrencies will eventually play a significant role in the country’s international trade.

He added that as the UAE develops its legal framework for cryptocurrencies, the focus will be on making the Gulf state become a hub with sound regulations and sufficient protections in place.

In addition to this, Dubai, the most populous city in the United Arab Emirates, has established the Dubai Metaverse Strategy in order to capitalize on the inherent benefits of the metaverse in order to accelerate its ongoing digital economic advancement.

Overall, the UAE’s embrace of cryptocurrencies and blockchain technology reflects the country’s commitment to innovation and efforts to become a digital economy leader.