UAE Central Bank Issues Statement on Digital Currency

Up to this point, there wasn’t much information available on the status of Bitcoin in the Middle East, yet that has since changed. Not long ago, the central bank of the United Arab Emirates issued a warning regarding the risks associated with using digital currencies as a medium of exchange due to issues involving volatility, money laundering, and speculation.

Governor of the UAE Central Bank speaks out

According to Gulf News, Mubarak Rashid al-Mansouri, the governor of the UAE Central Bank, speaking at the Islamic Financial Services Board Summit, stated that because digital currencies are not subject to official channels, they can’t be monitored nor controlled. Cryptocurrencies allegedly pose risks to the public as they can be used for money laundering, or for the funding of terrorism. Moreover, in the governor’s words, “The risks of trading in digital currencies have clearly appeared when the prices of digital currency fell sharply after some countries announced a ban on using initial coin offerings.”

While the main objective of the UAE’s Central Bank is to achieve and maintain financial stability in the country, some believe that these comments were far-fetched. However, they echo statements made by other regulators who hope to discourage digital currency use.

Reports also indicate that until now, the central bank of the UAE had refused to issue licenses for trading digital currencies in the country, thereby preventing digital currency exchanges from offering their services locally.

The head of asset management at the Emirates Investment Bank has stated, “The digital currencies are highly speculative and this is not backed by anything tangible.”

Based on everything that has been outlined so far, what do you think about the latest comments coming from the United Arab Emirates? Let us know your thoughts in the comment section.