Dubai wants to become a leader in all things blockchain

The city of Dubai recently hosted a world blockchain conference as part of its effort to become the leading blockchain-powered government by 2020. In attendance were Dubai dignitaries and ministers from the government as well as blockchain-tech companies vying for access to the Dubai Smart Government initiatives.

Dubai is both ahead and behind the U.S. in many respects. There are advantages to running a theocracy: less red tape, more opportunity to innovate quickly, and the possibility to rapidly pivot and adopt new technologies.

While the U.S. healthcare system is the most expensive in the world, and still results in the lowest life expectancy, Dubai’s system is 4.5x cheaper with essentially the same life expectancy. Despite this tremendous success, of course, it’s still illegal to be gay or possess weed in Dubai, so the state of civil rights still has a long way to evolve.

Leading that effort is Dubai’s ruler, His Highness Sheikh Mohammed bin Rashid Al Maktoum who recently launched a state-backed cryptocurrency, emCash, and appointed a dozen ministers all under the age of 35 to lead areas such as innovation, AI, blockchain and happiness. He is also subsidizing tech literacy through the One Million Arab Coders Initiative.

Where are the U.S. ministers with a strategy for AI or happiness?

The conference is an indication that blockchain space is “erging” — converging, diverging and yet still emerging.

While most of the world struggles to understand just what the heck bitcoin is, innovation of emerging companies is growing exponentially. Present at the conference were platforms such as NEM (mostly Phillipino and Asian-Pacific), Metaverse (China), SkyCoin (China), HCash (Europe and Middle East), Ethereum (mostly U.S.-Europe, and their Brooklyn venture studio ConsenSys) and TrueChain (India).

Notice there is no “bitcoin” company present here; the takeaway being that while the cryptocurrency with the largest market cap and most popularity has no “CEO” or “CMO,” it is still has very little real-world deployment/adoption outside of a currency. This is where the other platforms will enter to rival that bitcoin dominance.

Indorse CTO @gaurangtorvekar presenting about Indorse at World Blockchain Summit, Dubai! pic.twitter.com/qgTQFmQKXD

— Indorse (@joinindorse) October 28, 2017

It is these companies that are accelerating in their convergence and are racing towards the same goals of decentralizing the same products, the most important of which are identity and reputation. This presents a problem for users, since there is no single solution to identity authentication outside of the centralized companies of Google and Facebook. The Dubai government is at least attempting to solve this problem by implementing a smart city initiative which will implement technologies such as AI, open city data, renewable energy and urban transport into their municipal government.

While blockchain projects are competing for people’s attention and money, they still have not implemented any methods to scale to meet the world’s needs of 40,000–1 million transactions per second needed for a widely adopted platform. And instead of a platform’s merit, the space often reflects an attention-focused competition which means a lot of hype and marketing.

While NEM has stated its platform, nem.io, can handle “120 transactions per second,” according to Council Member Nelson Valero, there is little documentation to support this. Ethereum has also been attempting to implement their scalability architecture plasma.io and Proof of Stake algorithm Casper, but has no viable roadmap in sight. Meanwhile the bitcoin and ethereum blockchains are still only 4 and 7 transactions per second, respectively, while Visa operates at 40,000 transactions per second.

Perhaps the most important takeaway of all is the blockchain’s impact on centralized power.

With its recent ban, China is attempting to throttle the use of Bitcoin and blockchain tokens, which reflects the government’s approach to technology in general: “ban what we cannot control.”

In this respect, Dubai and Estonia are the first two countries to fully embrace the possibility of implementing blockchain architecture in their governments and allow for a level of innovation not present in most other parts of the world.

Describing the environment in China, Eric Gu, CEO of Metaverse, said, “From February to July, a short five months, we got about 30 different projects on Metaverse.” Then came China’s ban on ICOs and trading Bitcoin. “Now it’s recovered a little bit, I was approached by some founders who wanted to continue their projects,” Gu continued. “But if we can’t do it in China, we should move to places like Dubai and do our ICO here.”

This underscores the new paradox of our connected world: we live in a global ecology, a global economy and a national politic. Either the economy and ecology become nationalistic, which will never happen, or our minds and our borders expand globally. This is the promise of the blockchain ecosystem, and it is refreshing to see an Islamic country leading the way.