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Saudi Arabia, UAE plan Digital Currency different from Bitcoin

Wednesday May 16, 2018 6:00 PM , News Network

Saudi UAE Digital Currency

Riyadh: The Saudi Arabian Monetary Authority (SAMA) has selected a consultant to work with the central banks of Saudi Arabia and the United Arab Emirates, for launching a digital currency that would be accepted in cross-border transactions between the two countries.

Ahmed al-Kholifey, Governor of the Saudi Arabian Monetary Agency (central bank), said Tuesday operations will take place for six months as a trial and to evaluate the experience, Al Arabiya reported citing statements quoted by Al Eqitisadia newspaper.

Al-Kholifey said this digital currency will be different from bitcoin, as he expressed skepticism against trading it because it was outside the bank’s regulatory reach.

The new currency, restricted to inter-bank transfers only, will be recognized by the governments of both countries.

Saudi Arabia and the UAE are working to issue digital currency to keep up with the latest technologies and practices. Although there is official skepticism around bitcoin, blockchain is viewed as a groundbreaking system with huge potential.

There was global outrage against digital currencies few months ago with the Indian government, initially after issuing warnings against its use, finally termed its transactions as illegal. The decision by the Indian government came at a time when the price of bitcoin was increasing almost on daily basis.

Last week, Venezuela, the world's second-largest crude oil producer, had offered a 30% discount on India's petroleum imports from there if payments are made using Crypto Petro - the digital currency backed by the Venezuela government.

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