UAE, Saudi Arabia to Jointly Launch Cryptocurrency for Interbank Transactions

The central bank of the United Arab Emirates (UAE) is reportedly working on a blockchain-based cryptocurrency with the Saudi Arabian Monetary Authority (Sama). The cryptocurrency is set to be used for interbank transactions only.

According to a report published by local news outlet Gulf News, the financial institutions will issue the digital currency to use it in cross-border transactions between both countries. The report quotes Mubarak Rashed Al Mansouri, the governor of the UAE’s central bank, who was speaking at a high-level meeting for global bank standards and regulatory and supervisory priorities for the Arab region.

He was quoted as saying that this is “probably the first time ever” that two countries cooperate on creating a blockchain-based cryptocurrency, and that regulators hope “this achievement will foster similar collaboration in our region.” He added:

It’s just a study between UAE and Saudi [Arabia] and have not gone deeper into it. We have not put a framework when the study will be completed and who will be involved from both parties.

Al Mansouri clarified, however, that the cryptocurrency won’t be seen by consumers in general, as it’s set to only be used between banks. Per his words, it will be a way to make interbank transactions “much more efficient.”

In a separate statement, the UAE’s central bank reportedly said:

CBUAE and Sama intend to execute a joint crypto-currency and Distributed Ledger Proof-of-Concept (PoC). The PoC’s design mainly focuses on the transfer of ownership of a central bank asset (crypto-currency) among participants.

Notably, the UAE’s central bank, as CryptoGlobe covered, has earlier this year warned against cryptocurrency scams, including money laundering and their use to finance terrorism or other illicit activities, but predicted electronic money would replace cash in the future. Saudi Arabia has also warned against cryptocurrency trading, as cryptos are outside of regulators’ reach.

The space has seemingly been growing in the country, however, as a new cryptocurrency exchange called Bitex was launched there last month. The new trading platform reportedly offers BTC, BCH, ETH, and LTC trading pairs.

Reports suggesting Saudi Arabia itself has been planning to launch its own cryptocurrency have been circulating since last month. Per the Innovation Center (SPARC) director of the Sama, Mohsen Al Zahrani, the crypto is set to be launched next year.

Bitcoin Mining Pool Tries to Help Tone Vays Win $10K Bet Against Roger Ver

Cryptocurrency mining pool SlushPool has recently manually added a BTC transaction into a block to help Tone Vays, a derivatives trader and analyst, win a wager mage against BCH proponent Roger Ver.

The wager was made at the 2019 Malta AI & Blockchain Summit, during a debate between bitcoin (BTC) proponent Tone Vays and Bitcoin.com CEO and BCH advocate Roger Ver. In it, Ver argued BTC transactions are too expensive for business use due to the cryptocurrency’s small block size.

Vays, on the other hand, argued segregated witness (SegWit) and second-layer scaling solutions like the Lightning Network allow users to make small transactions without paying high fees, and that he has been using BTC on-chain without paying too much for transactions.

The debate ended up seeing Vays send Roger Ver $5 worth of BTC with a one satoshi per byte transactions fee – equal to the fees paid on the Bitcoin Cash chain – to see if it would confirm the same day. If it did, the CEO of Bitcoin.com claimed he would donate $10,000 to a charity of Vays’ choice.

During the debate, both parties noted the transaction was “priority 23,836 out of 24,355 transactions,” meaning that most transactions on the Bitcoin blockchain had to clear before miners picked that one up, at least according to fees paid for transactions.

As Vays soon noted on social media the transaction cleared after 10 hours. Some, however, found it strange. Cobra Bitcoin, the pseudonymous co-owner of Bitcoin.org and Bitcointalk, pointed out on social media that SlushPool – the mining pool that found the block the transaction was included in – manually added it to help Vays win the bet.

Cobra Bitcoin figured it wasn’t mined “naturally” as it was the second transaction included in the block – right after the coinbase transaction – despite the fee being less than 1% of that of all other transactions included in the block.

On Reddit, users pointed this out and accused SlushPool of manually adding the transaction. The mining pool, according to some users, is known for supporting BTC and being against Bitcoin Cash.

Should Roger Ver Pay?

The wager quickly became a controversial topic that seems to bring back memories of the scaling debate that was going on before Bitcoin Cash forked off of the Bitcoin network back in August of 2017.

Some argue that Roger Ver’s point stands as the transaction wasn’t “naturally” confirmed, but manually included in a block. Moreover the CEO of Bitcoin.com claimed he’d donate the money if it confirmed that day, and when the transaction did confirm it was past midnight in Malta.

On the other hand, some claim the transaction did go through anyway, and as such Roger Ver should donate the funds to a charity of Tone Vays’ choice. Moreover, Vays himself argued BCH supporters could have spammed the BTC mempool with two satoshis per byte transactions to stop his from clearing on time.

On Twitter, Vays created a poll that was retweeted by SlushPool and admitted the mining pool did prioritize the transaction. It currently shows most users believe Roger Ver should donate the funds. As one commenter pointed out, however, the results may change if Ver and other BCH supporters retweet the poll.