A senior executive at blockchain company Ripple said the UAE’s regulatory approach to cryptocurrencies sets a benchmark for other countries and provides a competitive advantage, boosting investor confidence in the Middle East.

Reece Merrick, managing director of Ripple’s Middle East and Africa business, told The National on Wednesday that the UAE’s clear regulatory environment has enabled it to foster a business climate conducive to innovation compared to many other countries, including the United States.

“The UAE’s supportive regulatory environment has created a very attractive environment for blockchain development compared to other jurisdictions that have not yet begun to develop clear regulatory guidelines for the industry,” he said.

He added that the UAE is leading the way in the Middle East and that adoption of the technology is surging “significantly” on the back of an advanced government framework that supports innovative businesses. “The UAE’s regulatory framework for digital assets is focused on overseeing and facilitating the growth of the industry, not restricting it,” Mr Merrick said, speaking ahead of Ripple’s partnership with the Dubai International Financial Centre’s Innovation Hub.

The growth is driven by increased remittance flows and improved efficiency in cross-border trade. As a result, he said, digital payments and adoption by fintech companies are gaining traction.

The San Francisco-based blockchain company and the innovation center are working together to further the adoption of blockchain and cryptocurrencies by the latter startups and give them access to developers to help them position the technology in their operations.

“Continued advancements in regulatory frameworks for crypto cross-border payments will provide the necessary confidence for banks and other regulated entities to fully adopt this technology,” Mr. Merrick said, referring to Abu Dhabi Global Market, Dubai Financial Services Authority and Virtual Asset Regulatory Authority.

Reece Merrick, managing director of Middle East and Africa at Ripple. Photo: Ripple Merrick said Ripple’s users in the Middle East account for one-fifth of its global customer base. Ripple builds its products on the XRP Ledger and uses its native token, XRPL, to facilitate cross-border payments. XRP is ranked seventh by market capitalization, with a value of about $29 billion as of Wednesday, according to CoinMarketCap.