US Digital Giants Highlight the Possibilities in the Middle East

Blockchain technology and cryptocurrency continue to make significant inroads into the Middle East technology sector.

The digital innovations could redefine finance, so nations across the region are becoming more interested in utilising it in various sectors.

Ripple, a leading provider of digital asset infrastructure for financial services, recently shared insights into the Middle East’s growing role in crypto-finance in a social media post.

Managing Director for the Middle East and Africa (MEA), Reece Merrick, gathered a report from 2,000 leaders from global financial institutions and enterprises, including over 200 from the United Arab Emirates, Saudi Arabia and Turkey.

His findings from the company’s 2024 New Value survey revealed that leaders across the MEA region are prioritising blockchain-based solutions in payments.

Participants were asked which payment types they plan to use blockchain-based currencies. Enabling customers to make payments with blockchain-based currencies (52 percent) topped the list. 

Accepting payments in such currencies (47%) followed closely. Buying, selling or trading other types of digital assets and making cross-border payments in blockchain-based currencies were also popular.

Blockchain has the potential to reshape financial systems across the region, and Merrick’s findings highlight that point to perfection.

A Growing Blockchain Ecosystem in the Middle East

The UAE government has been making moves in the sector, developing initiatives such as the Emirates Blockchain Strategy 2021 and Dubai’s blockchain and metaverse strategies, highlighting their commitment to advancing blockchain adoption. 

Dubai has particularly been the epicentre of the UAE’s blockchain move, pioneering key initiatives such as the Dubai Blockchain Policy and the Dubai Future Council for Blockchain.

The city has always been keen to integrate blockchain tech across government transactions, especially to provide added security, and their efforts were crucial in realising that ambition.

That determination also set Dubai apart, reinforcing the city’s status as a global blockchain hub. 

The UAE remains well-positioned to maintain its spot at the summit of the blockchain market with the backing of a progressive regulatory environment and investment from major global firms.

The emergence of blockchain tech in the UAE will also impact the burgeoning iGaming sector. Given blockchain’s ability to provide transparency and security, some of the best Arab casinos online are already adopting its solutions to ensure users can make swift and secure transactions.

With cross-border transactions now common in the Middle East, Arab players can expect near-instant deposits and withdrawals without having to worry about high service charges.

Meanwhile, the Dubai Virtual Assets Regulatory Authority (VARA) has laid the groundwork for fostering innovation under an air-tight regulatory environment.

Dirham-backed stablecoins have become crucial in streamlining cross-border payments and remittances.

If blockchain adoption in the Middle East maintains its current trajectory, there is a decent chance it will be deeply integrated into MEA’s banking systems in 2025.

A Regulatory Push for Blockchain Advancement

Blockchain is already spreading like wildfire. As ground zero, the UAE’s new gaming regulatory body could pave the way for a greater adoption of blockchain tech in the wider Middle East.

The UAE established a new Gaming Regulatory Authority to regulate and oversee the country’s digital and virtual domains. While the body is primarily tasked with overseeing gaming activities, its emergence also opens the door for blockchain tech to be integrated into various sectors, and not just within the borders of the UAE.

Blockchain and gaming have always gone hand in hand thanks to the technology’s ability to create transparent and immutable digital assets.

Non-fungible tokens (NFTs) have already made significant inroads in the gaming sector, providing a safe and secure platform for players to own and trade in-game assets. 

If the UAE’s regulatory body incorporates blockchain as part of its strategy, there could be widespread adoption of decentralised gaming platforms across the country. That will only serve to further cement the UAE’s position as a global blockchain hub.

Aside from gaming, blockchain tech’s inherent security and transparency make it applicable in other areas, such as digital payment, supply chain management and even government services.

If the UAE’s gaming regulatory framework successfully integrates blockchain, it could set a precedent for other industries to follow suit, potentially triggering a ripple effect across the entire Middle East.

While blockchain has the potential to be a major hit in the Middle East, but it could also hit a couple of stumbling blocks along the way, especially in terms of regulatory ambiguity.

Not all countries in the Middle East are as enthused about the prospect of blockchain as the UAE and Saudi Arabia, so while those two have embraced forward-thinking policies, others remain wary of venturing into uncharted territory.

The volatility of cryptocurrencies does not help matters, as it is a key component of the blockchain ecosystem. While blockchain offers solutions beyond crypto, the perception of financial instability could deter other countries from taking it into consideration.