2021-03-08 11:30:04

Adopt cryptocurrency, urges government summit in Dubai

The session on cryptocurrencies at the World Government Summit on Tuesday
Image Credit: Supplied

Dubai: Experts at the World Government Summit Dialogues here on Tuesday discussed how cryptocurrency could be the greatest wealth trend in the world today and explained how prosperity and the future are anchored on digital economy.

Brock Pierce, founder of Blockchain Capital and IGE, said governments should come on board in shaping the regulatory environment for digital currencies. He noted: “What’s imperative is that we make sensible decisions when we are passing regulations, because the world is changing and we don’t want to be left behind because of a decision made in haste.”

He added: “Nearly half of the world’s billionaires now have made their money in crypto. As we live through what could be the greatest wealth trend in the history of the world, it’s important to have more people participate in it,” he added.

Another digital expert, Denelle Dixon, CEO and executive director at Stellar Development Foundation, highlighted the role of cryptocurrency in creating access to financial tools that is not available to many people. She said: “We need to encourage central banks that issue these types of currencies not to ignore the private sector and all the work it has done to innovate. We can make the transition seamless for the end-users. Interoperability is one of the most important aspects in terms of payments and financing infrastructure.”

What is cryptocurrency?

Unlike paper money that has a physical form, cryptocurrency is a digital asset used as a medium of exchange. Individual coin ownership records are stored in a ledger existing in the form of computerised database using cryptography to secure transaction records and verify the transfer of coin or cryptocurrency ownership.

Dixon said during the virtual forum: “I think there’s a lot of fear around digital and cryptocurrencies, which are different from stable coins. They frighten regulators and policy-makers, which is understandable because it’s a new technology and most of the hype out there is about when things go wrong, not about when things have gone right.”

Embrace cryptocurrencies

Anthony Di Iorio, founder and CEO of Decentral and co-founder of Ethereum, had this bit of advise: “Governments need to embrace cryptocurrencies and educate people about them to ensure they’re not hindering the growth of their countries. They also need to get other industries to understand that these technologies can assist them and they’re not going to wipe them out.” Pierce added: “It’s human nature to fear that which we don’t understand, and we conquer fear with knowledge.” He added that people can start small — by purchasing digital coins for as low as $10 (Dh36.78) just to get familiar with digital currency.

With regard to industry regulation, Dixon reminded: “The network layer should not be regulated, as it needs to be decentralised. This will allow people to hold assets all over the world. Financial institutions that issue assets are already regulated. We need to make sure that we’re just regulating to address any gaps that exist with respect to digital assets.”

Cloud and blockchain technologies

In another session titled ‘Decentralising Finance for an Inclusive Economy’, Jutta Steiner, CEO and founder of Parity Technologies, said cloud and blockchain technologies can fast-track the adoption of innovations in developing financial models and direct financing as well as empower individuals and entrepreneurs to build more sustainable and stronger digital economies.

Steiner said cryptocurrency models and blockchain technologies allow people and investors to communicate directly when transferring funds and assets in an open online financial system that boosts credibility and transparency among users. The assets of companies operating in the field of digital currency have reached $40 billion.

She also explained that digital financial system is being developed under a long-term vision, providing new mechanisms, tools and solutions that facilitate access to loans and direct financing via smartphones and through advanced digital applications managed by individuals, which drives technological excellence and contributes to preparing for various global challenges.

“The world is witnessing a rapid adoption of decentralised financial systems, and we hope that governments will play a vital role by organising this shift towards innovative models that are successful alternatives to giant financial institutions in order to enhance the efficiency and reliability of the financial system and improve access to the financial infrastructure,” Steiner added.

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