When Blythe Masters, a British former executive at JP Morgan, first started whispering about the technology behind bitcoin being revolutionary, Hamid Rowaihy was enjoying the 25th year working at the state owned Saudi Arabian Oil Co., known as Saudi Aramco.
He describes his position there as “a knowledge management systems strategist, architect and a business culture change agent for Saudi Aramco” to then become a “Special Projects Group Leader.”
That’s until late 2015 when the blockchain was about to become a very big thing, at which point he invested in Ripple with Rowaihy now describing himself as an XRP holder and a consultant on “the future of global real-time payment and gross settlement between banks and financial institutions.”
That doesn’t quite suggest Aramco itself has bought XRP, hence the title being a question, but this oil giant which accounts for “90% of Saudi Arabia’s revenues and most of its foreign earnings” and is owned by the king himself, has been somewhat very active in the wider blockchain space.
“When I think about blockchain, it makes me re-think what we are doing today because blockchain will change the way we do business forever,” Fahad I. Al Tabib, leader of the Payment Processing Group in Saudi Aramco’s Banking Operations Division, said at the beginning of the year.
“This will not happen, especially in the financial sector, without the help of the local partner banks,” said Yahya M. Al Otain, administrator of the Finance and Accounting Division at Aramco, further telling participating banks:
“We are looking forward to your active participation with Saudi Aramco to establish this new network of blockchain within Saudi Arabia.”
A Transforming Country?
Saudi Arabia’s Crown Prince Mohammed Bin Salman has become a controversial figure after the apparent hacking of a journalist at a Saudi embassy, but he has laid out a vision to transform the country by creating a dynamic market friendly environment.
“Vision 2030 is a transformation into a more sustainable economy and job creation, and Aramco is at the heart of it,” Aramco’s CEO and president Amin Nasser told Fortune.
Among numerous tools to achieve such transformation is the blockchain, with XRP appearing to be under consideration.
“The Saudi Arabian Monetary Authority (SAMA) — the central bank for the Kingdom of Saudi Arabia (KSA) — has signed an agreement with Ripple to help banks in the KSA improve their payments infrastructure,” Ripple Labs, the company behind XRP, said last year.
The VC controlled project is finding competition from ethereum where there is a bit of controversy following the Ethereum Foundation’s decision to get “certification” as being halal.
Ethereum’s ConsenSys has participated in a number of Saudi related workshops or projects, but they have faced quite a bit of competition from IBM’s Hyperledger and Ripple.
Shopping around is what it could be called, with much of this being at early stages in a trial and error of sorts.
The somewhat elusive Ethereum Foundation, however, and their decision to get this certification, might suggest maybe there’s some sort of closer relationship planned especially when it comes to the financial usage of the blockchain.
“Virgil Griffith, when you were doing the sharia compliance audit they said us moving to PoS would not change the outcome much, correct?” – Vitalik Buterin, the ethereum co-founder, publicly asked.
“The islamic scholars actually preferred PoS over PoW because of the reduced waste,” said Griffith of the Ethereum Foundation who worked on this certification.
The Structureless Structure
As you may know, Saudi Arabia is ruled by two powerful dynasties. The house of Sheikhs, who command “religious” matters, and the house of Saud who govern the more earthy matters.
A pact between these two dynasties continues to be fully in force now a century on, with both fully reliant on each other for their power and privileges.
Whether either required such certification is not clear, with the Ethereum Foundation lacking much transparency, if it has any at all.
Islam however, which can be described as a pick and mix of Christian and Jewish teachings with little apparent innovation on either save for to bring religion to what now is known as Saudi Arabia, prohibits usury, describable as requiring interest on loans from money self created.
Proof of Stake (PoS) would give stakers about 6% interest a year in the form of money created from nothing which practically translates to a tax of sorts on all those that are holding eth and are not staking it.
A cost could be another word. A cost to keep the network running. Instead of such cost being in the form of buying energy, it would be in the form of buying eth itself.
The “tax” aspect might not necessarily come from holders, but the users of the network in the form of transaction fees or what can be called smart contract rent fees.
Whether this is sharia compliant or otherwise could be open to interpretation since words can mean anything if you are a Sheikh and have the power to decide what they mean, yet this debate was settled without any “certification” through a very fine analysis from Indonesia.
So considering the limited information, one must conclude this was some sort of bureaucratic requirement, with the question being for what?
Scooping all the Coins?
One can remember like yesterday a time when the atoms in the air made one feel bitcoin, and others like it, were an unproven experiment.
However, after numerous attempts to try and break it and it still standing, especially since last year it began to feel somewhat right to say this is not quite an experiment anymore.
The thing works, it moves, it stands, and there’s almost nothing you can do to it to make it stop without the general consensus considering it right to do so. Even then, any dissenter would have full freedom.
Anti-fragility they call it. Adaptable. Changeable. Flowing thorough the path of least resistance as if it has a life of its own.
With that awareness rising, one does wonder whether a country that has far too much money and apparently doesn’t quite know what to do with it, whether they’ve parked some of it in cryptocurrencies.
Denial is to be expected at this stage, just as is the lack of knowledge of whether it is in fact thus because we can only speculate, but it is beginning to feel in a turn of sorts like it would be a bit surprising if they were not nipping at the edges.
The question being whether control is the price, and the far bigger question, whether they can actually control it.