Cryptocurrencies are all the rage now, and every day, many new coins are coming to the market. Until now, we have only seen companies launch their own cryptocurrencies. But for the first time, a city has released a coin that will be centralized. The cryptocurrency is called the DubaiCoin, and it was launched by ArabChain Technology. After release, the price of the coin surged 1000% in just one day. The coin can be used to pay for services and goods in Dubai.
More about DubaiCoin
DubaiCoin is based on proof of work consensus and can be generated using mining. It is not decentralized though, as the circulation will be controlled by the city of Dubai. In a way, this wipes out the entire benefits of having a cryptocurrency launched by the city, but still, it is a step in the right direction. At present, the coin is trading nearly at $1.13, up 6 times from the initial $0.17 launching price.
With the launch of this new coin, Dubai plans to replace traditional banking methods. DubaiCoin can be used to pay not only online but also offline for a wide range of products. And since it is an official coin, even vendors are most likely to adopt it as a payment method.
Dubai’s openness to crypto
Dubai has been one of the most advanced cities to embrace cryptocurrencies. It has never instilled laws that prevented the growth of the currencies or banned them. Even the COVID crypto fund of India is set up in Dubai due to the clear regulations. I don’t think it would have been possible for them to do the same in India. The city embracing crypto means that we could see more Arabian cities do the same. It could also mark the beginning of cities launching their own centralized crypto. These coins will have all the benefits of blockchain technology and will also be centralized to minimize volatility.
Being centralized also means that, like the dollar and other fiat currencies, its supply would also be controlled in a way that benefits the authorities. And that makes it more or less a digital version of fiat. Let’s see if DubaiCoin manages to overtake the financial system of Dubai.
What are your thoughts on the new cryptocurrency released by the state of Dubai? And do you think that DubaiCoin being centralized loses its purpose? Let us know in the comments below. Also, if you found our content informative, do like and share it with your friends.