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Gulf Crypto Alliance with China and Russia
Gulf Cooperation Council (GCC) countries – notably the UAE and Saudi Arabia – are forging a strategic digital finance alliance with China and Russia. The core objectives are reducing historic dependence on the US dollar and establishing a multipolar global financial system. This shift responds to geopolitical pressures (e.g., US sanctions and repercussions of the Ukraine war) and aims to diversify oil-reliant economies.
Technological Focus: Rapid development of crypto and digital financial infrastructure underpins this strategy:
1. Central Bank Digital Currencies (CBDCs): UAE, Saudi Arabia, Bahrain, and Oman are actively testing CBDCs to facilitate cross-border transactions and replace the dollar in international settlements.
2. Stablecoins: Valued for price stability, these are attractive tools for regional digital economy growth. The UAE leads with its central bank-regulated stablecoin (AE Coin).
3. Joint Projects: Collaboration on initiatives like mBridge (a cross-border CBDC platform) demonstrates concrete commitment to linking national digital systems.
Geopolitical Alignment: This financial transformation aligns with strengthened political and economic ties with China, Russia, and the BRICS+ bloc. UAE and Saudi membership in BRICS and joint digital projects reflect efforts to create alternative financial mechanisms to the dollar-dominated system.