Forum seeks oversight over cryptocurrencies
Dubai - The lack of community awareness about the risks of digital currency exposes users to different e-crimes.
The Dubai Police are investigating a Dh300 million international fraud case that involves the use of digital currency, officials said on Sunday.
Police officials warned the community from the risks of unmonitored large-scale transactions of electronic currencies that can expose users to fraud, piracy and money laundering.
Major-General Khalil Ibrahim Al Mansouri, assistant-commander of criminal investigation department (CID) at the Dubai Police, said the lack of community awareness about the risks of digital currency exposes users to different e-crimes.
During a panel discussion, experts urged forming a supreme national committee to develop laws and regulations that can establish a legal framework to monitor the use of these currencies, in line with Emirates Blockchain Strategy. They also recommended issuing a digital UAE cryptocurrency using Blockchain technology and amending the Anti-Money Laundering and Counterterrorism Laws by adding articles that prohibit the use of digital currencies to finance or cover such crimes.
Heading the discussion, Lt-Gen Dhahi Khalfan Tamim, deputy chairman of the Dubai Police and head of general security in Dubai, said there are no guarantees to protect investors from piracy or fraud. He noted the rising market value of the electronic currencies prompted government officials around the world to warn against the risks of its trades, especially with the absence of legal regulations that protect investors. "Investigations show that gangs can use digital currency in suspicious financial transactions like money laundering, drug trafficking and funding of terrorist operations."
He said the electronic money will soon replace cash. However, the faith in digital currencies will always be questioned as long as its source and tracking system remain unknown.
Dr Saeed Al Dhaheri, chairman of the Dubai SmartWorld, stressed that the UAE should be the first to establish regulations that monitor electronic currency. He added that 56 per cent of companies that traded in digital currencies were shut only four months after their launch as it was clear that most of them were fake. "For every one successful digital transaction, there are five failed currencies," said Al Dhaheri.