According to the CEO of the United Arab Emirates-based financial institution Bank of Sharjah, Blockchain and cryptocurrencies are not only challenging to regulate but also here to stay. However, the CEO acknowledges that many banking industries are still unfamiliar with the technology despite this forecast.
A Groundbreaking Technology
Varouj Nerguizian, the CEO of Bank of Sharjah, has stated that blockchain and cryptocurrencies will not go away but will likely become a significant part of the banking system. On the other hand, Banks can only fully benefit from technology if they use non-public or enterprise blockchains, according to Nerguizian.
During an interview with Emirates News, the CEO also discussed how the blockchain could be a double-edged sword for financial institutions to adapt to the post-pandemic environment. He stated,
“Blockchain is a revolutionary technology that is not yet fully understood by the banking industry at large. While its application is easy to grasp in certain areas like Know Your Customer [KYC] or the real estate title deed verification, blockchain supposedly allows parties to transact with each other without the need for an intermediary. This raises the authorities’ concerns that would like to monitor the activity.“
Concerning the future of blockchain and cryptocurrencies, Nerguizian is quoted as saying that the technology will not go away, despite increased pressure from regulators and governments around the world.
“I believe blockchain technology, and by extension, cryptocurrency is here to stay and [are] impossible to regulate at large. However, in UAE, jurisdictions like Abu Dhabi Global Market [ADGM] and Dubai International Financial Centre [DIFC] have come up with crypto regulations and might in time be a significant part of the banking landscape as we move forward,” Nerguizian is quoted as saying.
Transformation to the digital age
Meanwhile, the CEO is quoted in the report as believing that the banking industry was on the verge of undergoing a digital transformation even before the pandemic. As the pandemic spread around the world, more businesses, including banks, adopted a remote-working policy.
When banks take advantage of their employees’ ability to work remotely, Nerguizian believes they will “reap future gains and profitability.”