- The central banks of both Countries will launch a common Digital Currency called Aber.
- Aber, UACEB-SAMA’s Digital currency, shall be implemented only in financial transactions using DLTs in a limited amount of banks in both the countries.
- Digital currencies can be accounted for as the Fourth Industrial Revolution which is responsible to mold the economic conditions of the world.
Mohammed Bin Salman, the Saudi Prince came to UAE for a discussion in relation to a digital currency plan as a joint policy measure.
The prince has received the Crown Prince of Abu Dhabi and Deputy Supreme Commander of the UAE Armed Forces, His Highness Sheikh Mohamed bin Zayed al Nahyan, as reported by UAE daily newspaper, The National.
The Digital tie-up
Four new policy partnership decisions have been agreed upon by these leaders in the above said official meeting along with seven strategic initiatives. Establishing digital currency to facilitate interbank transactions between the two countries was the main object of the meeting.
The Saudi Arabian Monetary Authority (SAMA) and the United Arab Emirates Central Bank (UAECB) disclosed details regarding the jointly-issued cryptocurrency in the month of January of this year.
This discussion forms parts of other significant partnerships these countries preliminarily had, which includes the construction of an oil refinery and cybersecurity cooperation.
UAE accounts Saudi Arabia as a safety measure which defends all interests of the country which leads to dividing the Arab unity as reported by the daily newspaper.
The report added that a meeting will be conducted between both the countries in Riyadh soon to discuss the various aspects of opportunities and obstructions with regard to their respective financial sectors.
Aber and its limitations
The central banks of both countries will launch a common digital currency called Aber, which shall be utilized to facilitate financial transactions using Blockchains and DLT’s as between the two countries.
Benefits provided by the digital currency include assessment of risks, establishing an additional direct link between the central banks of both the countries, the impact of remittance cost, etc. The performance of Aber depends on the use of a distributed database between the central banks and the participating banks from both sides.
Aber, UACEB-SAMA’s digital currency, shall be implemented only in financial transactions using DLTs in a limited amount of banks in both the countries. The usage will also be accompanies by several restrictions and regulations on a trial basis.
However, the banks have not released an exact date on which the digital currency is planned to launch according to the report. The usage of these currencies will be improved and expanded understanding legal and economic requirements of both the countries.
Aber and the other significant matters discussed in Abu Dhabi are the results of the negotiations made during the meet of the Executive Committee of the Saudi-Emirati Coordination Council, with respect to a seven-point bilateral cooperation plan between UAE and the Kingdom of Saudi Arabia, in January.
A new lead
Digital currencies can be accounted for as the Fourth Industrial Revolution which is responsible to mold the economic conditions of the world. The expansion of digital currencies on the Arab side is a positive sign which implies the growth rate of digital currencies globally.
Such initiatives accompanied by an appropriate regulatory system can ensure the sustainable development of the usage of such currencies to benefit the welfare of the individuals of such countries in areas that lack development and efficiency.
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