Lt-Gen Dhahi Khalfan Tamim of the Dubai Police predicted at a recent panel discussion that electronic money will soon replace cash in the United Arab Emirates. There remains a growing concern among authorities in the region that a lack of community awareness exposes digital currency users to fraud, piracy and ties to money laundering. Experts on the panel are pushing for the formation of a supreme national committee to develop a legal framework for the use of digital currencies, in line with the Emirates Blockchain Strategy.
Fraud Concerns Spark Dialogue on the Future of Electronic Money
The Dubai Police told the Khaleej Times on Sunday that they are currently investigating a Dh300 million ($81.6 million) international fraud case involving the use of digital currency. However, it appears unlikely that concerns surrounding crypto-related criminality will stop the growing popularity of crypto in the United Arab Emirates.
At the recent panel, Lt-Gen Dhahi Khalfan Tamim, deputy chairman of the Dubai Police and head of general security in Dubai, noted that there are no guaranteed ways of protecting investors from piracy and fraud. Tamim pointed out that this has become a major cause of concern for governing officials worldwide.
“Investigations show that gangs can use digital currency in suspicious financial transactions like money laundering, drug trafficking and funding of terrorist operations,” said Tamim.
Despite this, Tamim stated that he thinks electronic money will soon replace cash. He believes that as long as it’s untraceable, governments will always be worried about digital currency.
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Dr. Saeed Al Dhaheri, chairman of the Dubai SmartWorld, argued that the United Arab Emirates should become the first nation to establish regulations for monitoring electronic currency. He cited data that 56 percent of digital currency trading companies were closed within 4 months of launching after being identified as fraudulent.
“For every one successful digital transaction, there are five failed currencies,” said Al Dhaheri.
Earlier this month, the United Arab Emirates Securities and Commodities Authority (SCA) approved a draft of regulations aimed at Initial Coin Offerings.
“The Board of Directors, having reviewed a study on the best international practices in this regard, has issued a directive that the procedures for trading digital token are to be regulated,” read an official press release. “The plan developed by the SCA includes a set of mechanisms as part of an integrated project to regulate digital securities and commodities.”
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