The Central Bank of the United Arab Emirates (CBUAE) plans to launch a central bank digital currency (CBDC), among other initiatives, as part of efforts to become a financial and digital payment hub.
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Fast facts
- The plans are part of the country’s new financial infrastructure transformation (FIT) program launched on Sunday, which aims to support the local financial services sector through a series of initiatives.
- Stage one of the program includes the issuance of a CBDC for cross-border and domestic use, which the CBUAE said would “address the problems and inefficiency of cross-border payments and help drive innovation for domestic payments, respectively.”
- The government is also planning to begin the plans by launching a unified card payment platform to facilitate e-commerce growth and an instant payments platform to grow into a cashless society.
- Initiatives following the first stage in FIT include a digital assets innovation hub and an e-Know Your Customer platform to help crack down on illicit activity within the space.
- The FIT program announcement followed Dubai’s virtual asset regulatory authority releasing new guides on virtual asset activities for projects operating within the emirates last week, which included a ban on issuing “anonymity-enhanced cryptocurrencies,” also known as “privacy coins.”
- Last year, the Crown Prince of Dubai, Sheikh Hamdan bin Mohammed, said the city aims to be one of the top 10 cities globally in the metaverse economy, creating 40,000 virtual jobs and adding US$4 billion to the city’s economy over five years.
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