The space of blockchain tech and cryptocurrency is now slowly starting to pervade the traditional finance market. On the other hand, Arabs are looking to be amongst the references using the emerging technologies within the sector of large-scale operations to allow the use of cryptocurrency for banks.
Emirates News Agency publishes an article talking about the first meet between the Executive Committee at the Saudi-Emirati Coordination Council and Abu Dhabi. The purpose of this meeting is all about addressing the strategic problems regarding regional development within economic, social and military sectors.
This committee has 16 members belonging from the two countries- UAE and Saudi Arab. Mohammad bin Abdullah Al Gergawi is the Minister at Cabinet Affairs and The Future. He is the one heading this committee from a side of UAE.
On the other side, Mohammed bin Mazyad Altwaijri who is Minister at Economy and Planning is responsible to head this committee from the side of Saudi. They collaboratively introduced 7 joint initiatives which will incorporate through the timeline of 2019.
Talking about economic issues, they mutually decide to test out using blockchain tech, facilitating financial operations within these two countries. Finally, they are working on a pilot project for establishing a cryptocurrency regarding interbank essence in the first instance:
The cross-border digital currency will be strictly targeted for banks at an experimental phase with the aim of better understanding the implications of Blockchain technology and facilitating cross-border payments. The virtual currency relies on the use of a distributed database between the central banks and the participating banks from both sides.
This will set technology standards, protect customer interests, and assess associated cybersecurity risks. Moreover, this project will recognize the impact of a central currency relating monetary policies.
Till date, the team hasn’t released any further details regarding the features of the project. The only thing available is the initial draft which does not yet give a clear idea about how it works. However, there seems some speculation with the purpose of the announcement.
Within this joint initiative, the two central banks will be able to entirely validate blockchain nodes. Moreover, the traditional banks within these countries will hold inferior hierarchy nodes using for the transactions procedure.
This blockchain is private, which is not accessible to the general public, as the access to the information, is secure. Still, it will be a centralized blockchain which is designed to enable the transactions reversal while central banks need it.
According to the source info, the date of the first tests is still not available. However, there seem certain advances from the time central banks go familiar with blockchain tech presented by IBM, Ripple, and ConsenSys. These firms already give such outlet fundamental knowledge of the Hyperledger, xRapid, and Ethereum platforms.