Whilst addressing the issues in Dubai during Token 2049, Dubai experts prominently discussed the priorities bound to modern financial needs and what is required for crypto to become Caribbean-level competitions, focusing heavily on the need for regulation, use cases, and crime reduction.
In the Dubai cryptocurrency conference, considered a deemed effort, experts were eager to state the crypto market needs a lot more time to flush out innovative solutions that would allow traditional finance tasks to be replaced comprehensively. Ripe with potential, experts still agree the industry inherently lacks long-term viable design structures.
Navin Gupta Explains Crystal Intelligence’s Blockchain Competition
“Navin Gupta, the CEO of blockchain analytics platform Crystal Intelligence, reported that traditional finance and the system of digital currencies will compete initially. In his words, ‘The customer will benefit from better pricing, speed, quality, and efficiency owing to competition.’ Highlighting convergence, he adds, ‘This week, First Abu Dhabi Bank [along with IHC and ADQ] announced plans to issue their own stablecoin. Traditional institutions wouldn’t want to miss out because their customers would want the best of both worlds. They can access traditional finance, crypto, blockchain enabled finance, and then choose whichever one but from the same brand.’ He went on further, ‘But that will take some years because we have many institutions that need to snap to reality.’ In Gupta’s observation, competition will ‘definitely emerge’ in the next three years as a crypto option available to every customer.”
UAE’s Role in Adoption
As reported, The UAE is making progress towards the adoption of digital assets and initiatives to further develop the industry have been launched. Abu Dhabi’s ADGM has lured international participants such as eToro and M2, permitting them to function as brokers for securities, derivatives, and crypto assets, and provide opportunities for institutional and retail investors to manage virtual assets. Dubai adopted a law in 2022 to regulate the activity of the virtual asset marketplace with the aim of enhancing investor protection and expanding offerings. The emirate established VARA under the Dubai Virtual Asset Regulation Law for an advanced legal framework. The UAE Central Bank also issued a regulation on stablecoins last June, restricting the scope to dirham backed stablecoins only for goods/services in the Emirates. Navin Gupta commended the clarity of UAE policies, referring to an improving situation of policy certainty in the US as well, stating most jurisdictions realize “this genie cannot be put into bottle” and are, in a way, regulating to ensure safety.
Challenges and User Experience
Users experienced challenges in the metaverse as well. Alice Shikova from Space ID pointed out UI and cross-platform interaction as concerns. As she explained to The National, “It is still complex to switch between chains and to transact freely,” and “You always have to keep an eye out for possible hackers.” She proposed digital identity and on-chain names for enabling people and transactions verifiability. “A lot more needs to be done for adoption especially in the areas of remittances, payments, or digital collectibles,” has also said Navin Gupta.
Opportunities: Payments and Stablecoins
Stablecoins and payment solutions officials like Harrison Seletsky, from Space ID, pointed out, are extremely advantageous. He deemed traditional international remittances (multiple days and high costs) as contrary to instantaneous, cost-efficient, and permission-less crypto options. Furthermore, “Stablecoins capture a massive use case, particularly for emerging economies, as they offer people without easy access to USD instant access to safe, secure means on the blockchain.” Chief Executive of First Digital, Vincen Chok, also underscored that the “next frontier of borderless finance” is stablecoins which enable global, instant, and economical transfers constantly, surpassing the sluggishness of the traditional system.
Timeframe Predictions
The predictions of when crypto might integrate into or completely replace the traditional financial system vary greatly. Paul Talbert, managing director at Asset Token Ventures, noted that with more regulation and use cases emerging, people get comfortable. He suggested crypto adoption could overtake traditional finance in about five to ten years. Harrison Seletsky pointed out that it will take time since banks move slowly, but the underlying technology and proposition value are clear, suggesting there will be gradual movement in that direction over time.
Retail investors and the regulatory pace
Paul Talbert emphasized that the mainstream adoption of cryptocurrency will be aided by the influx of retail investors. He added this is happening gradually because regulation has slowed the pace of development more than it reasonably could have. He stressed that the US, for example, needs to adopt a regulatory framework like the UAE’s that is more favorable to retail investors.
Crypto Supporting TradFi
TradFi specialists do not need to be concerned about crypto replacing their work, as Vincent Chok suggests that crypto is more likely to support traditional finance. Simply put, crypto aids “financial fluidity.” Ryan Chow, the founder of Solv Protocol, considered spot Bitcoin ETFs as noteworthy identifiers of the integration of TradFi and crypto. Chow remarked, “Crypto isn’t reserved for speculators only. It’s gradually transforming into an element of the financial discourse,” continuing on to say, “Yes, there is still a long journey ahead for crypto in order to compete with TradFi, but there is a foundation for it.”
Tokenization Growth
Paul Talbert’s firm deals with the tokenization of assets of fixed income and private credit. He commented, “We’re witnessing a lot of growth. If you just look from 2023 to 2024, there was a massive increase in the amount of assets that were tokenized. And that growth will continue.”
