Cryptocurrencies are one of the many innovations that prove that the future is digital.
The meteoric rise of cryptocurrencies has dominated headlines, sent investors' heart rates spinning and baffled naysayers. Despite the risks associated with new digital units, the trend is gaining momentum in the UAE.
Dubai-based fintech group International Blockchain Capital (IBC) Group bought into homegrown media brand Acumen Advertising as part of the group's diversification plans for 2018, the latest in the UAE to join the bandwagon of cryptocurrencies. It has announced that Acumen Advertising will now accept payments in digital currency. The investment is the first of its nature within the media and marketing space in the region and is geared to give way to greater adoption of the blockchain technology across disciplines.
"Acumen Advertising will now accept payments in digital currency. The future is digital, so why should we be any different," said Khurram Shroff, chairman of IBC Group.
IBC Group was established in 2014 in the UAE, and traditionally invested in blockchain technology projects that were globally funded by HNIs and private family offices. The group is also a substantial owner and early adopter of various digital currencies.
"Blockchain is to now what perhaps the wheel was to the Bronze Age. It is a robust, scalable and transparent platform that can and will aid the growth of all businesses in the coming days," Shroff said.
Central Bank of the UAE Governor Mubarak Rashed Al Mansouri recently disclosed that the UAE is working with Saudi Arabia to issue a digital currency that would be based on blockchain and would be accepted in cross-border transactions between the two countries.
UAE residents will soon be able to make cash withdrawals from their cryptocurrency accounts at ATMs as US-based omni-channel solutions firm NCR Corporation signed a deal with UAE-based CoinHub to allow Bitcoin users to withdraw cash from their linked CoinHub cryptocurrency accounts at ATMs.
Of late, UAE developers have also been incorporating cryptocurrencies in their packaged deals to woo property buyers. MAG Group recently announced that it would offer customers the opportunity to purchase properties using OneGram, the first Shariah-compliant cryptocurrency.
In September, UK-based Money Trade Coin also launched a digital currency in the UAE, with listing on Sweden's Nova Exchange.
"The utility of blockchain and application of digital and community currencies is however not limited to online trading only and does have immense practical value when applied correctly to other transactions," Shroff said.
David Tobias, CEO of Acumen Advertising, echoed similar views and said IBC Group's involvement with Acumen is a welcoming addition to "our capabilities".
"In addition to enhancing our existing operational prowess, the group's experience in blockchain will add to, and shape the agency's future prospects," Tobias said.
To a question about covering the risk factor in cryptocurrencies, Shroff said his parent company's subsidiaries are operating globally across various sectors including real estate, hospitality, banking, food and beverage, agriculture and the technology sector.
"The parent company will back Acumen 100 per cent to avert risk of loss. We have the cash flow to shrug off lack of revenues, even if crypto value will go down significantly. All profits will be re-invested into the agency's assets, infrastructure and hiring the right people, to grow Acumen's share within the digital space," he said.
"Also interesting, according to a recent survey approximately 30 per cent of people in the age range of 18 to 34 would rather own some Bitcoin rather than traditional investments like stocks or bonds. Plus, with a shift in companies and governments slowly accepting cryptocurrencies as a legitimate source of funds, why stay behind?"
In reply to a question about the net worth of his family business and digital currency investments, Shroff said: "Our family has a history of enduring business successes and innovation globally, and we have plans to continue control of our private business activities by the family."
"All our financial information and outlook is kept private, but I can disclose that we have substantial stakes in currencies such as Bitcoin, Ethereum, Dash, Ripple and many others," he added.