Making Blockchain Safer

[Music] so um Mir I'm coming from a rather technical conversation to one which is less technical um uh safety and you know quite naturally uh a lot of conversation is around how do we make this space safer but before we even jump into that maybe just like two minutes just very quickly give a sense of you are and I know they've given a title but what does that actually mean uh and then we can obviously go into some context around uh what safety is looking like in in your perspective yeah absolutely thank you for having me Brian my name is Miriam Kian I'm the vice president for Circle Middle East in Africa um my mandate is to really invest and expand um what Circle does across um the region circle is a global fintech company that moves money at the speed of the internet uh we're probably better known for being the issuer of usdc and EC um usdc is the largest uh regulated stable coin in the world um and we're very excited to be expanding here in fact we just announced our incorporation in adgm yesterday yep and that was exciting development I think so when it comes to safety um a lot of people will inevitably start to think about is it is it a problem and obviously people around the room when I think about this some of you may may be using blockchain some you may be thinking actually should I be using it more am I concerned about what happens to me there are just recently just even this week you know Bloomberg was reporting about various scams and uh uh and and concerns that come from how easy is it for individuals to use um these capabilities without falling victim to in various activities so I guess one question is given your domain looking at this bre this region and obviously The Wider historical perspective how similar different do you see the nature of concerns you know the scams the type of activities that are happening in the digital asset space I think it's important to start by sort of highlighting the fact that blockchain has a transformative potential for the Middle East and Africa I think it's a very important part and that's why the UAE is focusing on this as well as AI um and probably to give a simple example because when people think about blockchain they don't necessarily sort of connect with uh many different sectors I could use uh our space so if I take the example of the use of digital currencies on the blockchain especially with uh stable regulated stable coins they have the potential to improve uh the speed of transactions reduce the cost as well as improve efficiency and transparency which is extremely important the reason why I'm saying that is because it's it's a it's a different layer on the top of blockchain which makes we make which really focuses on utility rather than sort of just having a technical platform when it comes to the safety of um blockchain specifically I think in my mind there are three key factors uh that influence sort of the safety of blockchain the first one of course is regulatory environment right if I take this region specifically between Middle East and Africa I think of um outside of the GCC more specifically the UAE the region still needs Clarity when it comes to to regulatory Frameworks legal Frameworks that would Foster innovation in the space would actually endorse the development of the blockchain space I think with the exception of the UAE which has done an extremely good job in terms of developing very clear boundaries and guardrails around what does regulation look like as for the safe use of blockchain Technologies as well as um sort of removing the risks that are associated with fraud associated with with human error Etc um so aggm is one of those Regulators um and I think this removes the risk of potentially having fraudulent activities Etc I think what remains to be seen in duae and the region is harmonization of Regulation I think this is where exposes probably some some of these use cases when there are no clear um guidelines or regul regulatory Frameworks that actually Force the players in the market to follow those you know to follow comp a compliant way of doing business on the ground we tend to see more of that I would say in UAE we probably see less of that now maybe that was an exception um and again this is probably linked to the bull market again I think we see a lot of Stak holders coming back into the market um however if I look outside of the GCC specifically in Africa and the right of the Middle East Africa tends to have a lot more of that I think we've seen few cases both last year um and early this year on this so regulatory environment is very important the second factor I think is around uh technology development and infrastructure again the region is not equal very fragmented you have the GCC we're blessed to have a a very well um so a progressive I would say government an environment that Fosters Innovation that focuses on um uh digital transformation Etc unfortunately that's not the case outside of the GCC again if you look at probably the rest of the Middle East in Africa you have poor internet connection you have sort of really poor infrastructure that would even enable players in the fintech space to try and build so that hinders you know the growth of the industry outside of the GCC and that ultimately impacts important areas for our region which is around Financial inclusion right as you probably know we have over two billion people who are either unbanked or under banked majority of them are actually sitting in our region right um and blockchain as well as digital currency provide them with a fantastic alternative to the traditional Financial system but without the ability um of building sort of a a blockchain ecosystem that can actually run on the web 3 economy where both businesses and users have the opportunity to have full control of their financial destiny but also have access to global markets so imagine an African business or middle eastern business that can actually on board onto the web 3 economy they can do business with anyone around the world they can be more competitive they can actually ultimately impact the economic development of their markets right um and the third Factor again is around probably uh economic instability again linked to probably the second point that I mentioned when you have a lack of regulatory environment lack of clarity lack of infrastructure what we tend to have is sort of bad players coming into the market why again because it's linked to financial inclusion people who are facing hyperinflation devaluation of their local currencies they're looking for volatile digital assets basically to save to store value right so instead of going to I would say probably usdc which is very regulated safe Etc they end up investing in volatile um assets that are not back they they're probably not safe uh which could create ultimately another issue within that environment well certainly I mean I think about it's not it's not a homogeneous when I think about the area you cover and just obviously the global uh Market certainly as you pointed out you will have attempts at fraud that's not new but uh certainly as you pointed out the regulatory environments are quite different the infrastructure the safeguards um and the economic incentive to act in that way is obviously um of interest for people who looking to cover uh to carry out elicit activity but then one of the things you pointed out as well is people are looking at this as an alternative to be able to either earn save hold U or even actually just access Global Financial Services we can't for you know ignore the fact that you there's been quite a runup in the uh digital assets Market over the last couple of months maybe it's linked to certain jurisdictions maybe favoring um the outcomes uh for for pro crypto Bitcoins just you know crossed 100,000 uh US dollar uh more recently and it's kind of oscillating at that number do you see that as a more speculative uh interpretation or does it actually reflect may maybe the market is actually more you know there's a lot more safety a lot more certainty uh a lot of the engagement that's happening is from that perspective it's little bit of both I think we're we're probably if you ask me 2022 my would have been very different whereas today I think we're probably getting to a point where we are on boarding institution large institutions into the space so there is a combination of trust that's being built uh with Bitcoin but also ultimately I don't think it's only that I think it's there is there are three areas here speculation definitely market demand um and also macroeconomic drop right it's a backdrop of of what's Happening um it it plays a role in in building trust around um sort of the blockchain But ultimately it's not only that um in contrast if I take for example stable coins and I'll give you you know an example of how probably how it was probably three years ago compared to now stable coins are more sort of play as a more of a St stable sort of um asset that people can store value in they can transac in ETC if I take the case of turkey for example in Nigeria a few years ago I remember people used to uh store value or transact in BTC whether that's a b B2B crossb payment or you know storing their value they used to sort of buy BTC or eth to do that today if you take these same markets the majority sort of the largest proportion of the market are stable coins why because it provides a dollar pegged in the case of usdc asset that is safer that's less volatile that has that's regulated and I'm only referring to regulated payment stable coins um and that's sort of changes so I believe stable coins probably are are more responsible for building sort of trust compared to probably the volatile disal asset it's getting better but I don't think we are there yet with the with various virtual assets okay so I see so certainly the the risk profile of these assets is quite different so obviously you have the regulated um issue tokens as as you've mentioned as well in the case of usdc so if we just use the last couple of minutes that we have thinking um looking ahead you obviously have some technology capabilities that are coming through people talk about things like zero knowledge proof and various other capabilities that are providing privacy protection and ways in which more safety guards can be locked in to these um digital asset ecosystems without necessarily relying on the individual to have the knowledge and sophistication from a circle perspective and from your own view of where the um you know where the puck is going what does that look like what are some of the perspectives whether they're regulatory or non-regulatory that you think would be helpful to build some of that safety um um all of the ones that you mentioned so the having a robust compliance process so for us as a as a as an issuer we take regulation very seriously we always go from the front door in terms of really having discussions with regulators and we've done that with edgm and other in the central bank and and other Regulators but we also Implement a very robust compliance framework where we have strong kyc AML processes to make sure that we avoid any sort of um risks to protect our partners and users and I think um adgm is doing exactly the same thing in a way sort of your monitor in the way you sort of um regulate issuers whether you regulate the custody element of uh of the issuance and distribution for example of digital asset is a very important element I think moving forward I don't think we have a choice where you're not regulated it's either there is no excuse anymore in the past I would say in the past few years people would say well we don't have the regulation in place Etc that's no longer the case if you look at the again Central Bank with the recent issuance of the the stab Co sort of framework including sort of the market consultations that adgm has have issued to really upgrade and and and make sure that they are up to speed with the technology development whether that's around AI whether that's around sort of the custody or defi even I think The Regulators are no longer just trying to catch up they are really sort of getting ahead of the industry and that for me gives me sort of the comfort that I think we are going to see more players sort of you know playing within the regulatory sort of environment rather than sort of staying outside fantastic um out of time thank you very much uh Miriam for the your insights and the and and the sharing that you've given to us this afternoon it's a pleasure thank you so much ran [Music]