Ripple’s massive 2018 just got a bit bigger. The company behind Ripple XRP is now opening up an office in the UAE’s (United Arab Emirates) Dubai. Ripple XRP prices shot up 13% at the news, and global investor sentiment seems to be allowing Ripple’s news to galvanize the market as a whole. But what does this news mean for the long term prospects of Ripple buyers, and cryptocurrency in general?
The first thing to understand is “why?”. Why is Ripple moving to Dubai? The answer is multifaceted, but all rationale points to blockchain adoption at the highest level of Dubai governance. Dilip Rao, Ripple’s Global Head of Infrastructure Innovation, speaking at the Global Islamic Economic Summit 2018, had this to say:
“I think that the UAE government saying that 50% of all government transactions will be on distributed ledger technology by 2020 is a fantastic way to encourage innovation, to bring fintechs to your market, and then to build the capability locally to iterate on those solutions that the fintechs bring to you.”
Rao went on to describe the expense and inefficiency that define international remittances made between the UAE and the rest of the world. As a new global hub for innovation, technology, and capitalism, Dubai needs its global financial reach to be free of friction, something Ripple excels at perhaps more than any other cryptocurrency platform.
Will Ripple Launch the Next Global Crypto Boom?
Ripple is already in use by at least two Dubai banks
Global crypto markets continue to look for a reason for optimism. Ripple may have provides this impulse. For its entire existence, Bitcoin has been most widely traded in markets like the United States and South Korea. As crypto prices have fallen over the past 10 months, these markets have not been able to recover, and regional investors remain cautious following massive losses.
While investors in the Middle East have existed for as long as Bitcoin has been widely traded, cryptocurrency has yet to boom in the Middle East in a way comparable to the cryptocurrency bull run of 2017. Ripple’s presence in the UAE – and the introduction of Dubai’s first domestic exchange, Crypto Bulls – could stimulate widespread trading in the immediate region and beyond.
As most cryptocurrencies have fixed supplies, the laws of supply and demand dictate that new money entering the space will drive up prices the world over. What’s more, if Dubai investors see blockchain technology implemented locally in tangible ways, this may be the “real world adoption” global investors have been looking for for years.
We’re excited to see how Ripple’s introduction into the UAE will change global perceptions of cryptocurrency. The splash may not be as big as we hope…but it could be bigger.
*Information in this article does not constitute investment advice