The year 2022 was an adventurous year for crypto, with the industry shaving more than $2 trillion off its market cap. Beyond nosediving prices and spiralling confidence, a stream of bad actors and fraudulent practices did little to bolster the industry’s tenuous reputation—just eight per cent of Americans now hold a positive view of crypto. Despite the damning numbers, it’s not all doom and gloom for the blockchain space. While their counterparts were busy blowing up, the serious contenders continued to build and regions such as UAE or within the Middle East emerged as crypto-friendly hubs.
Blockchain is booming in the UAE
With blockchain growing fast, the latest reports suggest more than $78 billion in remittance payments between Saudi Arabia and UAE, as they make the top 30 largest global remittance lists. The UAE government has been particularly supportive of blockchain technology in recent years, with a slew of initiatives to propel its country to the forefront of blockchain adoption. Some of these efforts include the Emirates Blockchain Strategy 2021, which aimed to digitise at least 50 per cent of government transactions, the Dubai blockchain strategy to make Dubai the 'happiest city on earth' and the first to be fully powered by blockchain technology, and the Dubai metaverse strategy to turn Dubai into one of the world’s top 10 metaverse economies, creating more than 40,000 virtual roles by 2030.
With easy regulatory authorities and progressive finance regulations, Dubai and the UAE have placed themselves on the top to become an emerging hub for crypto, while some others are still struggling to regulate or even ban crypto trading. Data suggests more than 8,000 active individuals in the Web3 space solely within the MENA region, with heavyweights like Crypto.com, Binance or The Hashgraph Association thriving in the region.
To foster the adoption of decentralised finance among young entrepreneurs, The Hashgraph Association has already partnered with Orange to support blockchain and fintech startups. Hedera’s grant programme also plans to expand into the UAE through the launch of Hashgraph Ventures out of ADGM and several important large enterprise collaborations within the UAE.
The Hashgraph Association’s growing presence in the UAE
The UAE was recently named the world’s second most attractive place to relocate for work in the digital sector by Boston Consulting Group, and major hot spots Abu Dhabi and Dubai were listed among the top 10 cities for sourcing digital talent. Kamal Youssefi, president of the board of The Hashgraph Association, emphasised UAE's appeal for blockchain companies, citing its innovative regulatory framework, strong talent base and diverse community. “I have just returned from the governing council meetings held at Google’s campus in San Francisco, and there was a consensus that the UAE’s innovative regulatory framework, strong talent base and diverse community make it an attractive destination for blockchain companies.
Dubai has become an important hub to support our activities in the region and grow Hedera Hashgraph ecosystem adoption in the Middle East,” says Youssefi. Among Hedera’s governing council members are Google, Dell, IBM, Boeing, Chainlink Labs, Deutsche Telekom, EDF (Électricité de France), LG Electronics, Ubisoft, University College London, and others. The UAE's ambitions to be the world’s first city powered by blockchain will need powerful technology that can accommodate the masses, and the burgeoning blockchain-based businesses expanding in the region will add towards its goal. Dubai's adoption of blockchain technology involves a holistic approach that encompasses not only technical aspects but also regulatory frameworks, partnerships, and ecosystem development. “Hedera has been built from the ground up with enterprise and government use-cases in mind, and that’s why the platform is governed by a collective of some of the world’s foremost technology, finance and educational institutions,” continued Hedera’s Youssefi in a statement.
Besides being selected by the DIFC courts and building the Distributed Ledger Technology ecosystems with Hedera technology and major telecoms provider, Zain has also joined the Hedera governing council. The Outlook for 2023 and beyond despite the broader bearish market conditions, Youssefi isn’t the only advocate for industry growth in this region. The UAE's blockchain ambitions extend beyond trade finance. Recently, the government of Abu Dhabi announced the launch of a metaverse gaming initiative, anticipating a global industry that’s projected to be worth Dh3.55 trillion by 2030. Scholars anticipate significant growth in digital collectables, non-fungible tokens (NFTs), and play-and-earn games within the blockchain gaming sector in 2023.
Hedera has already witnessed the launch of a Web3 game development initiative by Animoca brands and the introduction of a new competition feature in the popular online battle royale game, Apex Legends through an EA-licensed eSports platform created by former Amazon and Meta developers, built on Hedera. Youssefi further emphasised the role of Hedera's low fees, rapid transaction times, and fast finality in facilitating the growth of gaming projects. He expressed optimism about the continued expansion of blockchain applications in the Middle East. “We’re extremely bullish on the continued growth of DeFi, gaming, trade finance, and other projects that can lower the costs and expand accessibility for millions of underserved people in the MENA region,” added Youssefi.
User experience (UX) is another area that Youssefi expects to get a boost in the coming months. “With the collapse of FTX and other large industry players, 2022 highlighted the importance of self-custody,” he says, “but the fact is that [self-custody] is still too hard for the average user. The industry has to strive for ways to make it easier for people to embrace this technology. That’s why we designed the Hedera platform to be as accessible as possible. Developers can easily build decentralised applications (dApps) without having to learn new languages on the Hedera platform.” With so much building across key verticals in the blockchain space and notable government initiatives in thriving countries like the UAE, it’s hard not to feel optimistic about the outlook for this industry — in 2023 and beyond.
— Carolyna Mavis is a freelance writer.
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