IOTA commits $10M to advance tokenization in UAE

Solomon Islands partners with Soramitsu on CBDC pilotCentral bank digital currency (CBDC) development has been ongoing globally at a brisk pace in 2023 and smaller nations, like the Solomon Islands with a population of over 700,000, are no exception when it comes to that process with the introduction of Bokolo Cash.Photo by Gilly Tanabose on UnsplashIntroducing Bokolo CashSolomon Islands Central Bank (CBSI) has officially unveiled the proof-of-concept for its CBDC named Bokolo Cash, with support from Japanese blockchain firm Soramitsu. Bokolo Cash is pegged to the value of one Solomon Islands dollar.The proof-of-concept pilot was launched on Tuesday by way of a keynote speech given by Manasseh Sogavare, the prime minister of the archipelago. In that speech, Sogavare highlighted that the CBDC would lead to reduced transaction costs for citizens and businesses. Users can rely on transactions to be both secure and transparent, given that the network will be blockchain-based.The prime minister also articulated that the CBDC pilot project would be a catalyst for financial inclusion relative to the Island nation’s remotest communities.Pilot scheme use casesParticipants in the project will have the opportunity to use it in various scenarios. From retail transactions in the capital city, Honiara, to person-to-person transfers, the CBDC aims to demonstrate its versatility. The proof-of-concept will also assess wholesale transfers between commercial banks, simulate cross-border payments and examine remittances. To ensure security and compliance, users will undergo a “two-step” Know Your Customer (KYC) verification process, as outlined by Soramitsu.Operating on a customized blockchain based on Hyperledger’s Iroha, Bokolo Cash is designed for local use. However, it will also integrate with Soramitsu’s public Sora blockchain. This connectivity will enable users to engage in transfers using QR codes and the self-custody Fearless Wallet, a creation of Soramitsu.Legislative changeAlthough the project commenced at the beginning of November, the official announcement was made earlier this week. The legislation required to enable the CBSI to issue the CBDC — CBSI (Amendment) Act 2023 — was enacted on Nov. 3.The Solomon Islands, a collection of over 900 islands situated west of Papua New Guinea, now joins a group of island nations, including the Marshall Islands and Mauritius, actively experimenting with CBDC. Palau collaborated with Ripple Labs back in July to introduce the Palau Stablecoin (PSC). Interestingly, Tonga has contemplated adopting Bitcoin as legal tender, while Vanuatu hosts Satoshi Island, known for its Bitcoin-friendly environment. Meanwhile, Eastern Caribbean countries have already implemented an official CBDC called DCash.Soramitsu has been active in collaborating with central banks relative to the introduction of CBDCs, particularly in Asia. It has played a key role in facilitating the issuance of the Cambodian Bakong and the Lao DLak in Laos. Furthermore, it has initiated a project for regional cross-border payments using the Bakong and a stablecoin.In 2022, Soramitsu completed CBDC-related feasibility studies in conjunction with the relevant authorities in Vietnam and the Philippines. The Japanese fintech company has also participated with the Asian Development Bank and Tokyo-based global information technology solutions firm Fujitsu on a Web3 development project.

SBI and Saudi Aramco to explore digital asset business partnershipsJapanese financial services conglomerate SBI and Saudi Arabia’s state-controlled energy giant Saudi Aramco have jointly announced their exploration of potential collaboration in the realms of digital assets and semiconductors.Photo by Chris Liverani on UnsplashDigital asset portfolio co-investingThe partnership, which was publicly disclosed last week, aims to delve into co-investing in each other’s digital asset portfolios. Such an arrangement will leverage SBI’s substantial holdings and the formidable position of Aramco as the world’s second-largest company by revenue, boasting a staggering $604 billion figure. The partnership will mark a strategic alliance that goes beyond geographical boundaries, underscoring the global impact of digital asset investments.The collaboration between SBI and Aramco extends beyond mere investment, with SBI actively seeking to identify Japanese digital asset startups keen on expanding their operations into Saudi Arabia. The joint effort aims to provide comprehensive support to these startups, facilitating their integration into the Saudi market and contributing to the growth of the digital economy.SBI Middle EastIn addition to this venture, SBI is set to establish “SBI Middle East” in Riyadh, serving as a central hub for its operations in the Middle East. This move aligns with SBI’s recent announcement of a $100 million joint fund with Standard Chartered, based in Dubai, solidifying its commitment to fostering financial partnerships in the region.When contemplating cryptocurrency activities in the Middle East, Saudi Arabia might not be the first destination that comes to mind, given Turkey’s significant crypto adoption rate and the UAE’s well-established crypto regulatory authorities, such as Dubai’s VARA and Abu Dhabi’s ADGM.However, Chainalysis data reveals that Saudi crypto activity is steadily gaining ground, experiencing the most significant year-on-year growth (12%) to June 2023. Additionally, the country’s Vision 2030 initiative involves efforts to diversify its economy. With that, blockchain and Web3 are being embraced.TokenizationWhile lacking a formal crypto regulatory regime, recent reports suggest that Saudi regulators are warming up to the idea, indicating a shift in approach. A recent collaboration has emerged between the central banks of Saudi Arabia and Hong Kong which will explore tokenization and payments infrastructure.It is noteworthy that both SBI and Aramco explicitly referred to “digital assets” in their collaboration, avoiding the mention of cryptocurrencies. This emphasis raises the possibility that the focus might extend to tokenization, an area where SBI has a robust presence, notably through the establishment of the Osaka Digital Exchange (ODX), set to commence trading tokenized securities later this month.As part of its digital asset investments, Saudi Aramco has previously engaged in blockchain initiatives, including investments in VAKT, a post-trade solution for the oil sector. Additionally last year Aramco invested in blockchain startup Data Gumbo, which utilizes blockchain in order to bring about operational efficiencies. The collaboration extends to the approval of electronic bill of lading (eBL) providers like TradeGo.In February, Aramco signed an agreement with droppGroup to build out a range of Web3 technologies. Furthermore, Aramco’s investments in companies like Red Date Technologies and IR4LAB underscore its interest in developing blockchain-based services, including document and supply chain solutions.

OKX Burns $244M $OKB in Record Exchange Token Supply CutSeychelles-headquartered OKX, the world’s second largest cryptocurrency exchange, has conducted its largest-ever burn of its exchange token, $OKB, according to on-chain data.Approximately 5.5 million OKB tokens, equivalent to around $244 million, were removed from circulation. This record-breaking burn represents a significant milestone for OKX, surpassing the previous burns conducted since the monthly program’s inception.The burn was valued at approximately $258 million when calculated based on a 90-day average price, as reported by OKX. Chinese reporter Colin Wu highlighted that this burn marked another significant milestone in terms of the value of OKB tokens burned.Taking to Twitter on Thursday, Wu wrote: “The OKX exchange carried out the 20th OKB repurchase and burning on June 8, with a total of about 5.5 million OKB, or about 244 million US dollars, which once again set a new record for the value of OKB burning. OKX previously stated that it will burn OKX according to the seasonal market and operating performance, but has not disclosed the specific rules.”Photo by Jens Mahnke on PexelsBuy-Back & Burn program$OKB is described by OKX as a “global utility token issued by the OKX Blockchain Foundation,” offering holders various benefits such as discounts and exclusive access. The global exchange initiated the first Buy-Back & Burn program in May 2019. Since then, it has burned a total of 64,042,314.70 tokens as part of that ongoing burning process. Despite this significant development, the price of OKB has remained relatively stable, experiencing a slight increase of 0.29% on OKX. At the time of publication, the token was trading at a unit price of $44.97.Exchange token concernExchange tokens have recently garnered attention following the United States Securities and Exchange Commission’s (SEC) lawsuit against global crypto exchange Binance. The SEC has levied charges related to the sale of unregistered securities, resulting in a steep decline of nearly 15% in the value of Binance’s exchange token, BNB, over the past week.That scrutiny is likely to have followed the collapse of Bahamas-based cryptocurrency exchange FTX in November. At that time, it became apparent that the exchange was using its exchange token, $FTT, to prop up the business. FTX had issued $FTT tokens and used them as collateral, a dangerous act given that exchange tokens have no real-world asset backing and limited token utility.As the crypto market continues to face regulatory scrutiny and legal challenges, the burn of $OKB by OKX stands as a noteworthy event within the industry. The burn not only reduces the supply of $OKB tokens but also underscores OKX’s commitment to managing and enhancing the value of its exchange token. Market participants will undoubtedly monitor the implications of this burn and how it may influence OKB’s future performance in the evolving cryptocurrency landscape.Exchanges like OKX are likely to carefully manage the supply levels of exchange tokens, given market perceptions in relation to the extent of the utility of such tokens, the scrutiny of regulators, and the problems caused in over-extending supply in the case of other exchanges in the past.