SEOUL, February 04 (AJP) - The United Arab Emirates is signaling a fundamental shift in the global cryptocurrency market as digital assets enter a "nation-level phase" of adoption, according to Xin Yan, the CEO of blockchain technology company Sign.
Yan, whose firm has supported government blockchain initiatives in multiple countries including the UAE, said the transition is marked by a move from experimental pilot programs to systematic execution. This shift is expected to accelerate the use of stablecoins and central bank digital currencies, or CBDCs, while integrating real-world assets into the traditional financial system.
"It is a strong signal that crypto has entered a nation-level phase," Yan said. "Systematic adoption by governments will accelerate stablecoin and CBDC payments."
According to Yan, the UAE has adopted a strategy similar to Singapore, leveraging its status as a smaller territory with significant regional influence. By prioritizing digital infrastructure over restrictive regulation, the country aims to export its standards to the broader region.
Yan noted that while many countries announce blockchain pilots, few successfully transition to real-world infrastructure. He attributed this gap to the challenge of balancing government oversight with user privacy. The executive argued that successful implementation requires systems where regulation is enforced through code, using encryption techniques like zero-knowledge proofs to protect data privacy.
The CEO also highlighted a practical distinction between private stablecoins and government-backed currencies. He described private stablecoins on public blockchains as operating under "jungle rules" where asset recovery is often impossible. In contrast, he noted that CBDCs function as legal tender on permissioned networks, offering clear legal protections and eliminating the risk of de-pegging.
Despite the momentum, Yan warned of significant execution risks for governments engaging with blockchain technology. He cited the lack of a mature user base in the industry's early years, which led to many systems being untested under real-world conditions.
"Choosing the wrong partner can be fatal," Yan said. "I have seen projects run for three years, spend tens of millions of dollars, and still fail to launch."
Looking forward, Yan suggested that the focus for national governments will shift from establishing sovereignty to ensuring connectivity. He predicts that once countries develop their own domestic digital infrastructures, they will move to link these local networks to global liquidity and cross-border payment systems.
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