BUSINESS

ISLAMIC DIGITAL ASSET CENTRE TO REVOLUTIONISE LABUAN’S ECONOMIC LANDSCAPE

04/11/2023 04:01 PM

By Jailani Hasan

LABUAN, Nov 4 (Bernama) -- The Islamic Digital Asset Centre (IDAC) is set to revolutionise Labuan's digital landscape with a comprehensive ecosystem aimed at promoting economic development across finance and non-finance sectors. 

Labuan Financial Services Authority (Labuan FSA) Director-General Nik Mohamed Din Nik Musa said at the core of this ambitious venture is the establishment of a blockchain hub that will attract cutting-edge technology solutions, applications, servers, and high-end networks.

“The Labuan blockchain hub is designed to cater to the needs of financial institutions, insurance companies, multinational corporations, and governments looking to adopt blockchain technology. 

“An added advantage of this blockchain hub is its commitment to Shariah compliance, ensuring that all tech solutions adhere to Shariah principles,” he said at the Labuan Industry Dinner at the Labuan Financial Park Convention Centre here last night. 

He said this will enable a seamless integration of Shariah-compliant smart contracts and decentralized applications across the IDAC platform.

He said the entire ecosystem would be closely regulated, ensuring compliance with digital governance, market conduct, and anti-money laundering regulations to guarantee financial soundness and integrity.

“The technology underpinning IDAC's ecosystem promises to foster open, inclusive, and secure business networks while offering shared operating models, streamlined processes, and cost savings. 

“These attributes make it an appealing prospect for a wide range of industries,” he said.

Nik Mohamed Din said currently, Labuan International Business and Financial Centre (Labuan IBFC) has taken a significant step forward by offering a Shariah business solution. 

He said this solution encompasses an end-to-end Shariah-compliant blockchain, covering smart agreements based on Islamic principles and employing Artificial Intelligence to track and monitor transactions to ensure Shariah adherence.

Nik Mohamed Din said IDAC's other focus area centres around developing Labuan into a social finance hub, attracting corporations and non-governmental organisations to engage in social finance activities such as pension funds, pilgrimage funds, waqaf funds, and zakat funds. 

“These initiatives aim to serve both the local population and migrants seeking such products.

“To enhance social finance inclusion and wealth distribution, new entities will be established in Labuan, drawing inspiration from Malaysia's successful models and exporting these products worldwide through Labuan. 

“For instance, foundations and waqf-type foundations are already operational, focusing on socio-economic and community development, environmental work, cultural and sports initiatives, and other charitable work,” he said.

He said notably, Labuan is also exploring ways to promote corporate social responsibility (CSR) through “airdrops” or small tokens that digital asset issuers in Labuan will wirelessly distribute to identified citizens in the region and beyond.

-- BERNAMA


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