Blockchain Pilgrimage: Regulating Crypto ‘Should Be Combined With Education’ Says Top Wadzpay Executive


The collapse of Do Kwon’s Terra empire in May, and Sam Bankman-Fried’s FTX in early November 2022, will be remembered as two incidents that put the crypto industry on the back foot. It is now widely expected that regulators around the world will use the two incidents to justify the establishment of regulatory regimes that are likely to stifle further innovation. That notwithstanding, one Singapore-based blockchain payments company, Wadzpay, has partnered with Saudi Arabian fintech Geidea to provide financial solutions for pilgrims on their way to Mecca.

Providing a Cutting Edge Payment Experience to Visitors

Faced with the inevitable, some players in the crypto industry assert that tougher regulations are not going to stop cryptos and their underlying technology — the blockchain. They point to how digital currencies have been instrumental in lowering the cost of remitting funds inside and beyond national borders. According to this view, the ease and speed of moving funds across borders is another key attribute that makes digital currencies and the blockchain an indispensable part of modern payment systems.

It is these and other attributes of digital currencies that sustain their appeal even as regulators are looking to pounce, and some crypto companies are looking to find or expand into new markets and niches.

For instance, Wadzpay, a Singapore-based company that runs an interoperable blockchain-based payments ecosystem, has partnered with Saudi Arabian fintech Geidea to provide a “cutting-edge payments experience” for pilgrims traveling to Mecca. Khaled Moharem, president of Wadzpay for the Middle East and North Africa (MENA), explained to Bitcoin.com News how his company’s partnership with Geidea enables Hajj pilgrims with e-money wallets to better manage their expenses.

In addition to highlighting the impact of the two firms’ payments solutions, Moharem, a longstanding finance professional, also shared his views on topics ranging from the FTX collapse to regulation of the crypto industry.

Bitcoin.com News (BCN): Recently it was announced that your organization had teamed up with a Saudi Arabia-based fintech, Geidea, to provide future Hajj pilgrims with what was described as a cutting-edge payments experience for the visitors. Can you start by explaining why and how your payment solution makes things easier for Hajj pilgrims?

Khaled Moharem (KM): Thank you, yes, the partnership is to support digital payments for the pilgrims. In line with the Saudi Vision 2030, the partnership is forged in the backdrop of the Saudi government targeting to host 30 million Hajj and Umrah pilgrims by 2030.

The annual Islamic pilgrimage to Mecca is considered the world’s largest gathering, attracting some 2.5 million pilgrims in 2019 (according to Statista) before the Covid-19 pandemic triggered global lockdowns. According to Mastercard’s latest Global Destination Cities Index, Mecca, the holiest city for Muslims, generated approximately US$20 billion in tourist dollars in 2018.

Currently, pilgrims are faced with high fees when making traditional payments or overseas withdrawals or are needing to carry cash, which is not convenient for long pilgrimages. The combination of Wadzpay and Geidea’s solutions seeks to provide these pilgrims with e-money wallets to enable better expense management with payments supported through the security of the blockchain.

Our solution ensures that pilgrims can load their wallets in their home country and are able to fully enjoy their pilgrimage without having to worry about dealing with fiat. They will save on fees while enjoying a seamless payment experience.

BCN: What prompted you to create a solution that uses blockchain?

KM: Our partner, Geidea has more than one million POS [point-of-sale] terminals throughout Saudi Arabia; we see this as an opportunity for pilgrims to make payments without any currency or network limitations. Blockchain is a secure, distributed ledger that keeps a decentralized record of every transaction; the technology can significantly improve collaboration and simplify processes. Combining the reach of Geidea and the nature of blockchain technology leads to an incredible opportunity.

The pilgrim market is an essential part of the Saudi economy. This move will unlock vast SME business success for merchants across the Kingdom and make the payment experience for the pilgrims faster, safer and trackable. Through the power of blockchain, we are able to also improve the merchant’s bottom line through fast settlement and lower fees.

BCN: What does Wadzpay’s proposal to use blockchain in facilitating payments reveal about the prospects of the technology in the Kingdom of Saudi Arabia?

KM: Saudi Arabia is trying to accelerate their digital transformation. The Central Bank has looked to blockchain-based transfers, as has the Saudi Arabian Monetary Authority. The applications of blockchain technology in various important [areas] are limitless: whether logistics, oil, education or public services.

We believe that there are blockchain use cases that have a direct impact on the P&L [profit and loss] and can solve many existing business opportunities in the Kingdom.

BCN: The crypto industry has largely had a bad year — the Terra/Luna and more recently FTX crash — and some believe this affects adoption momentum. Others believe the worst is yet to come and that unless the industry is tightly regulated, more users will fall victim to crypto fraudsters. Do you agree that the industry has not yet seen the worst?

KM: We are very much pro-regulation. Regulations set clear guidelines upon which to operate and help limit fraud.

BCN: Do you agree that more stringent regulations will make crypto much safer for users?

KM: All industries need “bad sheep” on top of regulation, it is essential to have the education to avoid falling victim to various schemes. Regulation should be combined with education (just like in the world of fiat currencies, it’s important to be aware and not put your funds at risk).

BCN: In your view, how can the industry recover from the damaging impact of both Terra’s and now FTX’s collapse?

KM: The year certainly had some negative events (as well as many positive developments). As a company, we ensure that we avoid some of the risks that may prevail in this sector. For example, we utilize asset-backed stablecoins, as opposed to algorithmic coins which Terra/Luna was.

Similarly, to reduce the risk, we ensure that customer funds are held with insured custodians rather than on exchanges. This ensures security and accountability.

At the end of the day, blockchain is a technology while crypto is just one application of it. While pricing could be impacted by volatile digital currencies, we believe this transformative technology and its wide uses will prevail. We always focus on the tech, not the speculation.

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