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Islamic Development Bank to Create Blockchain Smart Credit Platform with Samsung's Blocko

It is a known fact that blockchain technology can help drive a tremendous change in the financial services sector. Central Banks are developing future-oriented economies and are devising means to align with the drastic changes that blockchain technology and digital assets are driving. While some are actively developing their state-backed digital currencies, Middle East powerhouse, Saudi Arabia is opening options for a blockchain-backed credit system.

This innovative project leveraging blockchain technology was initiated by the Islamic Research and Training Institute (IRTI), the research arm of the country’s Islamic Development Bank (IDB). The IRTI partnered with Samsung backed blockchain provider Blocko in an alliance that comes as part of the E24P.

The E24P is a collective of technology experts, distributed financial services providers, state-level government sponsors, and leading research institutes in the UAE and the UK working with clients in high-growth economies and sectors across the Middle East, Africa, and South East Asia.

Towards a Functional Credit System

The IRTI partnership with Blocko comes as part of the E24P regional consortium launched by Blocko in April 2020. This partnership will help create a functional blockchain-backed credit system that will help minimize the risks associated with credit financing to businesses and consumers.

With the projection of the Islamic Finance sector to expand to $3.78 trillion dollars by 2022, the IDB is eager to address any bottleneck that may impede this growth. The IDB, known as a non-interest bank, faces hurdles in the timely repayment of credit facilities by borrowers. The blockchain credit system currently under development will help put an incentive for timely repayment of loans while also helping to automatically donate late payment charges to the appropriate charities.

The smart credit management system will be built on the Aergo Hybrid Blockchain and with its many functionalities which also include insurance options for lenders will help create an efficient credit system.

Future Blockchain Engagements

Saudi Arabia is renowned for having friendly regulations with respect to blockchain technology. The Saudi Arabian Monetary Authority (SAMA) has profiled and believes blockchain and cryptocurrencies are redefining the future of finance. Through SAMA’s active engagements, we can conclude that the country is well-positioned to lead the region into a blockchain empowered future.

Saudi Digital Academy Partners With BSV Association to Establish New Blockchain Academy

The Saudi Arabian Digital Academy has partnered with the Bitcoin Satoshi Vision (BSV) Association to establish a new blockchain academy in the country.

Billed as the first Blockchain Academy in the entirety of the Middle East, the announcement disclosed more details with the plans from the academy by providing blockchain learning and development resources for a variety of audiences – including developers, students, start-up entrepreneurs, business executives, and government agencies representatives.

The Saudi Digital Academy is a government-sponsored initiative that has a strong focus on human capital development related to tech and communications for clients. The Blockchain Academy will be centred on the BSV Blockchain and its capabilities as an enterprise-grade blockchain network that can host a number of applications and facilitate transactions at a meagre gas fee.

“Since the initial academies announced at our launch event in October 2021, we continually look to add new fields of learning. Given the high interest in blockchain technology, we are proud to work with BSV’s team to bring world-class blockchain training to Saudi Arabia in this landmark initiative for the Middle East,” said Eng. Faris AlSaqabi, Deputy Minister for Future Jobs & Capabilities at MCIT.

“Because the Fourth Industrial Revolution involves many emerging technologies, the SDA seeks to attract multiple digital academies in order to provide training across all fields that will be vital to Saudi Arabia’s digital transformation,”

While the purported Riyadh-based Blockchain Academy will be the first in the region, the Saudi Digital Academy aims to establish many more related academies.

With many trusting blockchains as a vital tool in redefining education, the receptivity of sovereign nations to crypto is generally at a low ebb, considering the competition they pose to sovereign fiat currencies. However, many countries, including China, are tapping the potentials of blockchain to advance new Internet of Things (IoT) functionalities in their countries.

51% of Crypto Investors in Saudi Arabia Optimise Crypto Future, KuCoin Study Shows

Nearly 3 million citizens in Saudi Arabia have entered the crypto space over the past six months, according to a study by KuCoin.

To explore the adoption and penetration of cryptocurrencies in Saudi Arabia, crypto exchange KuCoin released an “Into The Cryptoverse Report”. The study unravelled sustainable interest among crypto investors in Saudi Arabia. Per the report:

“51% of crypto investors invest because they believe it is the future of finance, while 44% believe that cryptocurrencies can bring them higher returns in the long run compared to other types of financial investment.”

Over the last six months, 14% of the adult population entered the crypto space by either trading digital assets or owning them. Furthermore, 17% of adults depicted crypto curiosity and were likely to invest in cryptocurrencies in the next six months.

New market entrants were going through the roof, with the report stating:

“The high proportion of new market entrants is unique to Saudi Arabia, as 76% of crypto investors have less than one year of experience in crypto investment, including 49% of those who first started trading cryptocurrencies in the past six months, suggesting strong demand for crypto education in the market.”

Despite the onset of the bearish market in the second quarter of this year, some crypto owners in the nation still showed confidence in their investments. The study also highlighted:

“In the second quarter of 2022, 31% of crypto owners in Saudi Arabia said that they would keep their crypto balance as is rather than increase their investment.”

However, the ratio of gender inequality is a bit high when it comes to crypto investment because 63% are men and 37% are women. Nevertheless, women investors depict a more practical mindset by looking at realistic benefits. The survey stated:

“48% of female crypto investors are motivated by its profitability in the long run, and 42% of females invest in crypto to gain passive income.”

With 42% of Saudi crypto investors seeing the profits accrued as a stepping stone toward improving their families’ living conditions, the KuCoin study found out that these unique aspects were opening up new horizons and possibilities for the cryptocurrency market in the nation.

Meanwhile, Argentinians have been seeking shelter in stablecoins following the resignation of the economy minister, Blockchain.News reported.

HSBC Undertakes Blockchain-based Trade Finance Transacntion for Automotive Sector in the Middle East

Through the Contour platform, HSBC conducted a blockchain-based trade finance transaction between SAIC Motor, a Chinese car manufacturer and Taajeer Group, the exclusive agent for MG cars in Saudi Arabia.

With the help of blockchain technology, it would significantly increase the speed of dealing with paperwork. HSBC noted that by using distributed ledger technology has the potential to revamp the trade finance sector by slashing transaction times to less than 24 hours from the present five to ten days.

Per the announcement:

“The Contour platform enabled end-to-end digitisation of the credit documentation required for Taajeer to import a shipment of cars from SAIC in a process that is up to 10 times faster than using physical documents.”

Chaker Zeraiki, the head of global trade & receivables finance at HSBC UAE, stated:

“Our digitizing at scale means making customers’ lives easier and, with Contour it means we’re cutting costs, reducing risk and speeding up trade. Bringing these benefits to the automotive sector and Saudi Arabia are a measure of our international connectivity and our global leadership in trade banking.”

Contour seeks to digitize the worldwide trade finance industry worth $53 billion through decentralized technology by integrating digital networks across present fragmented ecosystems and trade routes as a blockchain trade finance network.

Carl Wegner, Contour’s CEO, pointed out:

“This transaction marks an important milestone in the Middle East’s automotive sector, proving that distributed ledger technology is successfully transforming the trade finance ecosystem.”

The blockchain-powered trade finance transaction is a first of its kind on Saudi Arabian soil, and it is seen as a stepping stone towards the nation’s Vision 2030 initiative of becoming a regional trade hub.

HSBC has emerged as a notable facilitator of blockchain-based trade transactions.

For instance, the leading British multinational investment bank and financial services holding company partnered with Wave to execute a blockchain-powered trade between China and New Zealand, Blockchain.News reported.

Argentina's fan token drops 31% after losing against Saudi Arabia

The value of the Argentine Football Association Fan Token (ARG) has significantly decreased as a result of Argentina’s shocking loss to Saudi Arabia in the first match of the FIFA World Cup by a score of 2-1. This is in line with the expectations of the country’s devoted soccer supporters, who believed that Argentina would win its opening match.

The information that was supplied by Coingecko indicates that the price of an ARG token before to the beginning of the match was $7.21.

However, as a result of the soccer team led by Lionel Messi’s poor performance, the price of the token fell by 31% to reach $4.96 by the time the game was over. It then rose to $5.22 at the time this article was written, but it had already reached $5.22 when it was written.

On the other hand, the floor price of “The Saudis,” a Saudi Arabian-themed nonfungible token (NFT) collection that is unrelated to the soccer team, increased by 52.6% over the same period of time, going from 0.196 Ether (ETH) to 0.3 Ether before leveling off at a price of 0.225 Ether, which is approximately $250 in value. “The Saudis” does not have any connection to the Saudi Arabian national soccer team.

On the Socios platform, which is a blockchain-powered fan engagement platform, CHZ operates as a native ERC-20 token. Socios is one of the most prominent factors behind the recent growth in the number of sports-fan tokens.

Despite the fact that the tokens do not represent ownership in the teams, buyers of them are provided access to certain awards and the opportunity to vote on certain decisions made by the teams that sponsor them. This is the case even if the tokens do not reflect ownership in the teams.

In the recent past, there has also been an increase in demand for fan-based tokens in the business of athletics.

Since January 2022, the volume of token sales has climbed by more than 250% on a month-to-month basis on average. This growth can be traced back to the beginning of the year.

Despite the fact that they were not designed to be used in this manner, it seems that some individuals have understood the tokens as a way to indirectly gamble on the success of the teams who are utilizing them.

The value of the tokens may also be impacted by occurrences and tendencies that are unrelated to the success of specific soccer teams. For example, the natural ebb and flow of cryptocurrency markets as well as breaking news may have an effect on the value of the tokens.

In May, the blockchain-based decentralized smart contract platform Algorand became the first official sponsor of the FIFA World Cup to be powered by blockchain technology.

The final round of the competition is set to take place on December 18 this year.

SAMA is Ramping Up Its Research into Central bank digital currencies

The Saudi Arabian Monetary Authority (SAMA) is stepping up its investigation into central bank digital currencies (CBDCs), although it has not yet disclosed any plans to implement such a currency.

The bank announced that it was working on a phase of a project that “focuses on domestic wholesale CBDC use cases in conjunction with local banks and fintechs” in a bulletin that was issued on January 23.

Nevertheless, it was revealed that there had been no definitive decision made to introduce such a digital currency in the Middle Eastern country.”

SAMA emphasises that despite the fact that no decision has been taken on the implementation of CBDC in the Kingdom, it is continuing to concentrate on researching the advantages of introducing CBDC as well as the possible hazards associated with doing so.”

SAMA is doing research on numerous areas of a state-issued digital currency, including the applications of a CBDC-based payment system, the economic effect of the currency, and the preparedness of the market.

In addition to this, it plans to examine the relevant legal, policy, and regulatory aspects.

This action is being taken as part of Saudi Arabia’s Vision 2030 programme, which aims to lessen the kingdom’s reliance on oil, diversify its economy, and expand public service industries such as healthcare, education, infrastructure, leisure, and tourism by the year 2030.

The governor of SAMA, H.E. Fahad Almubarak, said that local banks and payment businesses would play a significant role in the CBDC project and its execution.

In 2019, SAMA was able to carry out the CBDC experiment known as “Project Aber” with flying colours.

It carried out this investigation in conjunction with the Central Bank of the United Arab Emirates in order to determine whether or not blockchain technology may play a role in international financial transactions.

Late in the year 2020, the banks published a report detailing their research and coming to the conclusion that a dual-issued CBDC was technically viable for facilitating cross-border payments and presented a “significant improvement over centralised payment systems in terms of architectural resilience.”

There is no information available on the technology that underpins the Saudi CBDC; nevertheless, CBDC Tracker implies that it is built on the Hyperledger Fabric developed by the Linux Foundation.

The Atlantic Council, a think tank based in the United States, reports that as of right now there are 11 nations that have completely implemented a CBDC and 17 countries that are conducting pilots.

The vast majority of those that have already begun operations are located in the Caribbean, with the exception of one in Nigeria.

Saudi's $250M Tech Innovation Boost with Hashgraph (HBAR)

The Hashgraph (HBAR) Association, in a groundbreaking move, has announced a strategic partnership with the Ministry of Investment of Saudi Arabia (MISA) to launch the DeepTech Venture Studio in Riyadh. This collaboration, encapsulated in a five-year agreement worth $250 million, marks a significant milestone in fostering Web3 and deep technology development within the Kingdom. The venture aims to empower over 500 companies by providing them with the necessary tools and resources to develop innovative technological solutions, leveraging advancements in artificial intelligence (AI), distributed ledger technology (DLT), robotics, the Internet of Things (IoT), virtual reality (VR), and quantum computing.

The DeepTech Venture Studio is designed to become a hub for technological innovation in Riyadh, highlighting Saudi Arabia’s commitment to diversifying its economy and embracing technological advancements. Through this initiative, Hedera Hashgraph aims to stimulate growth in the technology sector, leading to significant breakthroughs across various industries. This partnership not only underscores the Kingdom’s strategic shift from its traditional oil-based economy but also showcases its dedication to fostering a dynamic ecosystem for startups and entrepreneurs.

In addition to providing technical engineering, training and certification, and project delivery services, the DeepTech Venture Studio will offer support in product development, business strategy, commercialization, marketing, legal and regulatory compliance, and venture capital investments. This includes IPO listing support on the Saudi Exchange (“Tadāwul”). Managed by The Hashgraph Group, this initiative is part of a broader effort to enhance the competitive edge of Saudi companies on a global scale.

This partnership reflects a mutual commitment to investing in the digital future and contributes positively to the three pillars of Saudi Vision 2030, aiming to foster a thriving digital economy in Saudi Arabia. The initial phase of the Venture Studio will focus on ramping up local operations and onboarding the first batch of 100 projects, with subsequent phases aimed at accelerating and scaling up operations both locally and globally.

Overall, the DeepTech Venture Studio represents a significant step forward in the Kingdom’s efforts to become a leading hub for fintech and technological innovation, aligning with its broader economic diversification and innovation strategy.