Former Softbank Exec Launches UAE Dirham-Backed Stablecoin
Akshay Naheta, a former executive at SoftBank Group Corp, has recently launched a new company, Distributed Technologies Research (DTR), in Abu Dhabi, focusing on stablecoin technology.
The company is situated within the emirate’s international financial free zone, and Naheta has collaborated with Hong Kong-based DRAM Trust for this venture. DRAM coins, the stablecoin introduced by this partnership, will be backed by the United Arab Emirates dirham.
Stablecoins, as a type of cryptocurrency, are tokens pegged to an underlying asset, often the US dollar. In the case of DRAM coins, their value is tethered to the UAE Dirham, offering stability in comparison to the high volatility seen in some countries, including Turkey, Egypt, and Pakistan. This stablecoin technology aims to serve individuals in these high-inflation nations, particularly the unbanked and underbanked populations.
Unlike many stablecoins, which are typically pegged to the US dollar, Naheta's DRAM coins present a unique approach by being backed by the UAE dirham. The choice of pegging to the dirham is strategic, providing greater stability for users in regions facing economic challenges. Naheta has expressed a specific focus on addressing the needs of the unbanked and underbanked in these nations, offering them a stable financial alternative.
The collaboration plans to make DRAM coins available on decentralised exchanges, including popular platforms like Uniswap, Sushiswap, and Pancakeswap. The team also intends to explore partnerships with centralised exchanges in the future, expanding the reach of DRAM coins. This move aligns with the broader trend in the stablecoin market, which has become a significant part of the Web3 ecosystem.
The stablecoin market has seen substantial growth, with approximately $124 billion worth of stablecoins in circulation, according to CoinGecko. While stablecoins have primarily been used by traders for moving digital assets between exchanges, Naheta's project aims to extend its influence beyond trading. DRAM coins are not only positioned as a means for stable value transfer but also as an alternative to the SWIFT system, traditionally used for international money transfers.
Naheta, known for his involvement in significant deals during his tenure at SoftBank, believes that the UAE, with its significant expatriate population and proximity to high-inflation nations, is an ideal market for the DRAM stablecoin. Drawing parallels with Switzerland, he sees the UAE as geopolitically neutral, a robust transportation hub, and a top tourism destination.
As the stablecoin market continues to evolve, Naheta's DRAM coins represent a unique initiative catering to the specific needs of regions facing economic challenges, emphasising financial inclusion and stability. The success of this venture could contribute to reshaping the landscape of digital finance, offering an alternative financial solution for individuals in high-inflation countries.