< Previous20 Vol. 23/08, August 2022 C OVER S T O RY / BLOCKCHAIN the future of Innovation 20 Vol. 23/08, August 2022arabianbusiness.com 21 Blockchain, metaverse, cryptocurrency: The story of how these technologies will reshape and revamp the Middle East’s business landscape IN KNOWLEDGE PARTNERSHIP WITH arabianbusiness.com 21 The transformative power of blockchain technology has, for years, been heralded as the next step for businesses to evolve. While the opening salvo of the blockchain first emerged as the power behind bitcoin over a decade ago, its implementation is still ongoing. The Middle East has already made steps to establish itself as a hub for technology, including blockchain, and in this month’s special feature we will analyse the impact blockchain and its associated Web3 technologies will have, the role that the Middle East will play, and how investors and entrepreneurs need to keep their focus on the future. Our analysis comes at an inflection point for the Arabian Gulf. Authorities across the region are placing more focus on establishing their respective nations as global leaders and hubs for the technology of the future. This month, Dubai unveiled its metaverse strategy, with the emirate looking to increase the technology’s contribution to GDP to $4bn, and grow the number of firms operating the sector by a factor of five. In Abu Dhabi, a new campaign is set to provide women with free crypto, NFT, and blockchain domains in a bid to increase diversity in Web3 development. Meanwhile, across the border in Saudi Arabia earlier this year, the technology arm of the futuristic city development of NEOM announced that it would launch the world’s first cognitive metaverse. This exciting technology will continue to be a key focus for Arabian Business moving forward as its implementation looks set to fundamentally alter the way business is done in the region. 22 Vol. 23/08, August 2022 C OVER S T O RY / BLOCKCHAIN forms of money: clay tablets, precious metals, and more recently, fiat (paper) currency. I believe that cryptocurrency stands to be the next evolution of money, as it has notable qualities that are unlike any other form of money that precedes it. In recent years, far too much emphasis has been put on the speculative nature of cryptocurrency, and so many people are hungry for more information about its practical benefits. In a recent panel discussion I was a part of, one of the panellists remarked: “Why would my grandmother want to use crypto?” I have compiled a very simple, practical list of crypto benefits that everyone can understand. Fast Cryptocurrency transactions are simply much faster and have less barriers. Transactions often complete in minutes, if not seconds. The traditional u Future of fi nance Cryptocurrency transactions are simply much faster and have less barriers u Digital Dallago has faith in cryptos Despite recent setbacks, the transformative technology of cryptocurrency is still revolutionising the fi nancial sector across the region Why you should still believe in cryptocurrency BY JOSEPH DALLAGO, CEO AND CO-FOUNDER OF RAIN Cryptocurrency is one of the most important inventions of our lifetimes, and yet, its power is still so misunderstood by the general public. As we enter a down cycle in the crypto markets, it is an opportunity to revisit the foundations of this industry and what makes it valuable. Over the course of history, we have adopted a number of different arabianbusiness.com 23 Resilient Cryptocurrency is backed by the global economy. The global economy should remain more stable over the long term, as it will not be affected by the monetary policy or the local economy of a single nation. Cryptocurrency is also decentralised, so it is very difficult to change by a single party and immune to political motivations. Similar to the manner in which the smartphone and internet were introduced in the 1990s to transform human convenience and capability, cryptocurrency is revolutionising the financial sector – for the better. From simplifying transactions to equalling the playing field for individuals of all income brackets, the advantages that cryptocurrency provides in a decentralised financial system far outweigh that of the traditional system, while offering infinite possibilities; this trend will only continue as cryptocurrency becomes more accessible over time and technical hurdles are overcome. With that said, those who are slow to adapt or refuse to invest in cryptocurrency and understand its intricacies will inevitably be left behind. banking system takes days to send international wires. Cheap Fewer parties in a transaction mean reduced costs, making the movement of money cheaper for everyone. The transaction is also purely digital, so transaction fees should continue to reduce over time. Always available: Crypto does not sleep – it works 24/7/365. The traditional banking system only operates 9 AM-5 PM, five days a week. Inclusive Crypto has a low barrier to entry – you only need a mobile phone and an internet connection. Given that 84 percent of the world has a smartphone, crypto can help bring financial inclusion to those unbanked by the traditional financial system. Global You never need to be physically close to a person to pay them. You can pay them in the same way regardless of where they are in the world. Imagine being able to send money to your family in another country or pay for goods online, all without having to use a special service. Transparent Most crypto transactions are recorded on public blockchains that are visible to everyone. It is very easy to see the status of your transaction and when the money you are sending reaches the recipient. Microtransactions Any small businesses do not accept credit cards because they would lose too much money in fees when selling low-priced goods. Since crypto transactions are purely digital, their cost should approach zero. Crypto is able to support sub-fill transactions today, but in the future, we could see smaller transaction amounts than previously thought possible. Bitcoin is divisible up to eight decimal places. Precise You can always pay an exact amount u Digital currency Cryptos can help bring fi nancial inclusion to those unbanked by the traditional fi nancial system $21,100 The value of 1 bitcoin as of Tuesday July 26, 2022 / BLOCKCHAIN and do not need to worry about change. This allows senders and receivers of money to know exactly how much money they are exchanging. International wires via the traditional banking system often cannot send exact amounts, as intermediary banks take a cut of the transaction. Egalitarian All participants in the cryptocurrency financial system are treated the same. Organisations that are part of new industries will be able to be banked, and your nationality, skin colour, or financial status will never again be a factor when acquiring banking services.24 Vol. 23/08, August 2022 The go-to person for marketing and business developments in the corporate/ crypto world, Everdome’s chief marketing offi cer Bally Singh reveals why he believes it’s essential for corporates and blockchain pros to work together to achieve success or else risk being left behind Bridging the gap between blockchain and corporate C OVER S T O RY / BLOCKCHAIN You have over 25 years of experience in developing and staging large-scale entertainment events and global experiential marketing campaigns. How has crypto/metaverse factored in to your events? A sell-out Sean Paul tour in the UK was definitely an early high point. It was the first time he’d performed in the UK, and all seven dates sold out. Another would be the first time we held an event on the sidelines of the Abu Dhabi Grand Prix. We entered a multibillion-dollar market with no contacts or existing links within it, and with competition that had several years of operations under their belt, yet we organised a sell-out event. There have definitely been lots of highs in my career so far, but I think my biggest event is yet to come as we’ve signed a deal between FTX and Hoko Agency. Why is it essential for blockchain pros and corporates to work together? When it comes to blockchain, crypto and even the metaverse, it’s my belief that corporates are having difficulty capturing audience attention. Blockchain in particular has the di-gen audience captivated right now, which is why I think it’s essential for corporates and blockchain pros to work together to achieve success, or corporates will be missing out on a huge revenue growth opportunity for the future. What corporates need to do is work out which industry players can benefit them the most. Just as how in music we’d turn to the likes of Pharrell Williams, Ludacris, Kanye West, the Weekend, and Jay-Z. For crypto, leaders such as Sam Bankman of FTZ, who was one of the largest holders of Bitcoin, and Rob Gryn, CEO of the world’s most hyper-realistic metaverse, Everdome, are your go-to guys. You have extensive experience in combining tech with the music, entertainment and sports worlds. Why are these kinds of collaborations vital? I’ve worked across the tech, music, u Huge opportunity Technology companies want a slice of the growing music industry worldwide, Singh believesarabianbusiness.com 25 $602bn The projected digital advertising spending worldwide this year, according to Insider Intelligence Q WE’RE ALREADY AT AN INCREDIBLY HIGH STANDARD HAVING ACHIEVED PHOTO REALISM” entertainment and sports worlds for most of my career. During that time, I’ve come to realise that the corporate and crypto worlds face the same difficulties that technology companies had when trying to break into music. Technology companies wanted a slice of the growing music industry and its strong audience, but couldn’t quite figure out how to capture the market. This changed when they began identifying and collaborating with key members of the music industry, such as Pharrell Williams, who is himself an innovator. At one point when I was working with a Microsoft partner, I brought Williams on board as an advisor. He was the ideal person to help us understand the mind-set of the music industry audience. We held think tanks and focus groups, which led us to create solutions that would capture the audience’s attention. As you continue to launch new brands and produce events in parallel to successful branding and marketing campaigns that attract international attention, what makes Everdome unique? Rob Gryn is the CEO of Everdome, which will be the world’s most hyper-realistic metaverse when it launches later this year. He took a completely different approach to marketing Everdome. Instead of taking the standard approach and simply employing someone to oversee marketing strategies and so on, he acquired a percentage of Hoko Agency, the business I co-founded and serve as chairman of. This gave him instant access to global events and activations, essentially providing an in-road to some of the world’s most exciting events. Hoko Agency is involved in Formula 1 hospitality around the world, as well as destination marketing, Polo, and on-ground activations for companies such as Moneygram. My team and I had a head start in pushing Everdome to the world, as we were already heavily embedded in the events and marketing industry. Gryn doesn’t just take the academic or tried-and-true route to success; he thinks bigger, more creatively, in ways that can and will create positive disruption throughout the market. To create the most hyper-realistic metaverse, Everdome uses breakthrough photorealism to create a super slick real world-extended experience. Where do you foresee this trend going? If there’s one thing that’s guaranteed with technology, it’s that we will continue to find ways to innovate for even better results. Even within the past decade it’s easy to see just how far digital visuals have progressed, in the online world and gaming in particular. Think about how rudimentary the first virtual reality graphics were; they were block-based and cartoon-like before evolving into the beautifully slick imagery you’ll see in Everdome, which leverages cutting-edge technology from Metahero to create real-to-life visuals. We’re already at an incredibly high standard having achieved photorealism, so wherever technology takes us next is going to be very exciting. What can we expect to see from Everdome in the near future? We’ll announce some amazing new partners who will bring their brands into the Everdome metaverse, making our ecosystem even richer. And, of course, we’re going to release the news that everyone’s been waiting for, an update on the timeline that will see the launch of the Everdome mission to Mars. You can expect a number of immersive events in the lead-up to the launch, which will give the public a chance to get hands-on with Everdome, to experience what life is going to be like in our metaverse. / EVERDOME u Tech Everdome will be the world’s most hyper-realistic metaverse u Racing Hoko Agency is involved in Formula 1 hospitality u Hyper realism Rob Gryn, CEO of Everdome $200bn The estimated value of the global gaming market by 202326 Vol. 23/08, August 2022 Binance CEO and founder Changpeng Zhao explains how the platform aspires to be the gateway to Web3 with tools that are simple and accessible, in order to educate users about what ownership means in the Web3 universe The aspiring Web3 gateway C OVER S T O RY / BLOCKCHAIN Introducing people to the new variant of the internet is key, as many still struggle to understand what Web3 is and how it will affect them, says Binance CEO and founder Changpeng Zhao. He explains: “From our side, we’re already showcasing Web3’s day-to-day use cases. Partnerships with the likes of Cristiano Ronaldo, Khaby Lame, and The Weeknd are not simple promo activities. They’re meant to highlight to the public how crypto and Web3 can enhance their lives. The beauty isn’t in bringing in the big names; it’s in accessing their audiences and demonstrating that Web3 isn’t just a tech dream for the nerdy few.” The origin of the Binance ecosystem Since 2017, Binance has grown to over 200 times its original size, and there are now Binancians all over the globe. “We support 18 different languages, help nurture a blockchain with over 2.4 billion transactions to date, and have an ecosystem that serves over 120 million users – a number far beyond the wildest expectations I could have had back in 2017,” Zhao says. Since 2017, Binance has significantly expanded its product lines as users began clamoring for access to new, innovative blockchain- powered offerings. Today, the platform’s catalog offers something for everyone. “From Trust Wallet to CoinMarketCap, Binance NFT to Binance Earn, we cater to virtually every interest across the broad spectrum of what blockchain and crypto have to offer,” he explains. The past year also saw the introduction of Auto-Invest, Binance Live, Learn and Earn, and many newer services. A products portfolio with greater connectivity Web3 is about connectivity and Binance products should be no different, Zhao says. “We need to connect with the user in a simple way, tailored to their language and culture, and most importantly, compliant u Evolving industry Web3 is bringing together all the technology we’ve seen developed over the past years, Zhao saysarabianbusiness.com 27 120m+ The number of people who trades using the Binance platform Q WE SUPPORT 18 DIFFERENT LANGUAGES, HELP NURTURE A BLOCKCHAIN WITH OVER 2.4 BILLION TRANSACTIONS TO DATE” with their local laws,” he says, adding: “How can we build a Web3 future without making our products intuitive to use?” Binance is privileged to have the most extensive product portfolio in the space, including advanced trading products such as derivatives, margins, and loans. “We also offer accessible financial products through Binance Spot, Earn, and Convert, as well as exciting new products like Binance Card, Pay, and NFTs,” Zhao adds. To improve the Web3 experience for users, Binance has developed itself into a super app. In essence, this enables users to switch between their Web3 and fiat worlds seamlessly. “There’s still a lot of work to be done, but I think solid foundations are there for us to build on in the next push,” Zhao explains. Still, at its core, he sees Binance as a single product with a sole focus on bringing financial freedom and inclusion to the world. Empowering users through education According to Zhao, the greatest risk we face as an industry is the increasing gap between the total number of new users entering the marketplace and the total number of users with a detailed understanding of blockchain and crypto. “Education has, of course, been another rock upon which Binance has built its reputation,” he says. “Binance Academy, Learn and Earn, and Binance Masterclass are integral to educating our users and helping them make more responsible, informed decisions.” Future plans and the potential of Web3 Web3 has a massive potential to transform our lives, and Zhao explains that they want to improve the existing version of the internet with responsible Web3 inclusion. “In the next five years, it will be paramount for Web3 to begin to tackle tangible problems that Web2 users continue to face. We must build products that are secure, user-friendly, accessible, affordable, and that bring real, tangible value for people.” “We are also thankful to regulators, policymakers, and industry players for collaborating to create a safe and secure crypto ecosystem that puts users first,” Zhao adds. “But the work isn’t over yet; we must continue cooperating with regulatory bodies that protect our industry and investors while enabling responsible innovation.” Engaging with regulators at all levels Binance’s continued leadership position relies on its willingness to proactively engage with regulatory bodies wherever they operate. Zhao explains, “Within the past year alone, Binance has received regulatory approvals and registrations in Spain, France, Abu Dhabi, Dubai, Italy, and Bahrain.” Just like in any other industry, knowledge in the crypto world is power as it enables Binancians to confidently make decisions and recognise when they need help or support. “If we can imprint this attitude in the minds of the majority of crypto users, responsible and successful mass adoption will become almost a certainty, given enough time.” Zhao believes the crypto and blockchain world has entered an incredibly exciting phase. “Web3 is bringing together all the technology we’ve seen developed over the past years: NFTs, digital identities, tokenomics, play-to-earn models, and much more,” he says. Furthermore, the industry and Binance are seeing a massive influx of capital and talent due to the emergence of Web3. Throughout history, whenever these two have met, there have been massive leaps in adoption and product innovation. Zhao adds, “We saw it in the ‘80s with client- server tech. We saw it in the ‘90s with the internet, in the 2000s with mobile phones, and in the 2010s with social media. The 2020s will be the decade of Web3, where users take back control of their data and decision-making processes, and the value they create.” / BINANCE u Super app Binance enables users to switch between Web3 and fi at worlds28 Vol. 23/08, August 2022 C OVER S T ORY / BLOCKCHAIN metaverse increases its contribution to 1 percent of the emirate’s overall GDP. Headed by the Dubai Crown Prince Sheikh Hamdan bin Mohammed bin Rashid Al Maktoum, the strategy is built around key pillars – innovation, government implementation of metaverse technologies and talent development. Bas Lemmens, general manager EMEA for blockchain data platform Chainalysis, says that these pillars had been “rightly earmarked,” and lauds the government’s proactive efforts to “pioneer new digital frontiers” in the metaverse revolution. “This revolution is already gaining momentum, with VR technology, virtual real estate and blockchain all working together to bring us closer to a meaningful digital ownership,” Lemmens tells Arabian Business. DIGITAL INNOVATION Blockchain technology is a new, powerful tool that is already shaping the future of the internet u City of the future The Dubai Blockchain Strategy will usher in economic opportunity for all sectors in the emirate Dubai unveils its metaverse strategy with businesses and communities to benefi t On the road to virtual work BY SHARON BENJAMIN Dubai recently announced a plan to boost the contribution of the metaverse to the economy to $4bn by 2030. The new strategy will be supportive of the emirate’s overall growth and improve the lives of residents, experts explain. Announced by Dubai Ruler Sheikh Mohammed bin Rashid Al Maktoum, the strategy aims at ensuring that the arabianbusiness.com 29 make use of this time to think, plan and execute their shift, right from marketing activations, to holistic brand strategies. “We should all be getting ready to live in a vast digital world, rather than being the last ones to jump on the bandwagon, because [the development of the metaverse] is happening now,” he adds. The Dubai Metaverse Strategy is set to increase the number of companies in the emirate, five times over with more than 40,000 virtual jobs, adding a value of $4bn to the emirate – all in a time span of five years. The strategy, which aims to place the emirate as a global hub for companies operating in the metaverse and blockchain sector is home to more than 1,000 tech companies, which contribute $500m to the national economy, Sheikh Hamdan bin Mohammed bin Rashid Al Maktoum said in a tweet. “Brands in the country now have the potential to lead the way towards meaningful adoption of these game- changing technologies,” Lemmens concludes. Dubai will now see the global presence of 300 experts and 40 specialised organisations in a discussion in September 2022 – aligned with the Dubai Metaverse Strategy. Hosted by the Museum of the Future, the discussion will speak of the unlimited opportunities of the metaverse, which are yet to come. The metaverse has a remarkable time ahead of it now that it is backed by the government, Lemmens adds, explaining that the technology is already getting attention not just in Dubai, but globally due to the emirate’s efforts of being a global market across all sectors. However, an “emerging space” such as the metaverse can only be a driver of GDP if it relies on current and future utilities, according to Lemmens. In addition, those branching out in the fields of metaverse and blockchain must be well-versed in the sector and its functions. “A deep understanding of blockchain, NFTs and other elements that will enable the metaverse is what will allow innovators in the field to envision and transform into reality powerful and impactful use cases for citizens, consumers, and businesses,” Chainalysis’ Lemmens says. For Shadman Sakib, a tech entrepreneur and investor known for his short-video platform Vurse, the recently launched strategy reflect Dubai’s efforts to use and develop technology to ensure seamless living – be it physical or virtual. However, the metaverse isn’t just another buzzword that will fade over time. “It is the next evolutionary step in the age of connectivity for individuals and businesses alike,” Sakib explains. “It [the metaverse] promises to bring our digital and physical lives closer together in terms of health, socialising, efficiency, shopping and entertainment,” Sakib says. He also notes that the metaverse will drive more than just an individual’s identity and digital ownership, especially due to evolving technology. “Just like the internet changed the way we shop and how it facilitated ecommerce, the metaverse will see new models of ecommerce evolve into something more,” Sakib says. Today, businesses both in Dubai and globally are reinventing themselves to be part of the new-age revolution, while others remain sceptical. On seeing this shift, Sakib emphasises how companies must u Emerging tech Bas Lemmens, general manager EMEA for Chainalysis u Harnessing blockchain Shadman Sakib, tech entrepreneur and investor $1.5bn The annual savings in document processing Dubai stands to achieve by adopting Blockchain technology / BLOCKCHAIN q JUST LIKE THE INTERNET CHANGED THE WAY WE SHOP AND HOW IT FACILITATED ECOMMERCE, THE METAVERSE WILL SEE NEW MODELS OF ECOMMERCE EVOLVE INTO SOMETHING MORE”Next >