The Central Bank of Saudi Arabia (SAMA) has announced that it is using blockchain technology to deposit funds with local banks.
An official statement issued by SAMA said the funds were part of the bank’s initiative to strengthen “its ability to continue its role in providing credit services” . The bank did not specify the exact amount of the transfer of funds.
SAMA’s participation in the blockchain
The Middle East is seeing widespread application of blockchain technology in the financial sector. SAMA has performed extremely well in terms of using the blockchain for money transfers for banks located in Saudi Arabia and the United Arab Emirates.
In 2018, SAMA also partnered with the UAE Central Bank to develop a digital currency that can be used for cross-border transactions between the two countries.
Looking at its recent transaction and active participation in the blockchain space, a recent SAMA announcement states:
“SAMA is one of the pioneer central banks experimenting [with] blockchain money transfer technology. This move is one of the key innovative initiatives launched by SAMA in its program to activate and develop financial technologies in the Kingdom.”
Blockchain in the world of finance
The increased involvement of governments and central banks in the blockchain sector plays an important role in the perception of technology in finance.
It was announced yesterday that a major Turkish bank has completed its first international blockchain-based trade finance deal. Another report states that almost 40% of fintech companies operating in Hong Kong use DLT.