Dubai entrepreneur to launch crypto community for nickel

Reuters/Yusuf Ahmad

• Nikel token to capitalise on the metal’s growing economic importance
• Nickel’s price has risen by a third in the past year
• But production may soon not satisfy demand

A prolific Dubai-based entrepreneur is set to launch a crypto token aimed at opening up the asset market and “shaping the future of nickel”.

The Nikel token will launch in Dubai next week. Safi Qurashi, CEO of NewTek, told AGBI that it will “create a community that can help shape the future of nickel, and capitalise on its growing importance in the global economy”.

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Qurashi said that he hopes investors will not only make money through the Nikel token, but also that the community he builds will to be able to shape the production and mining practices of those companies extracting nickel from the ground.

Holding one Nikel token, he explained, will give each person one vote on how the pooled capital is used, whether that means in developing new products or investing in green mines.

“Harnessing the power of blockchain and cryptography makes this process much easier, more open and transparent, and puts it in the hands of the community,” Qurashi explained.

He added that this is not necessarily a replacement for traditional investing in the nickel industry, but a way for people to exact more control over what happens to a portion of their investments.

Qurashi, who is originally from London, said the ultimate objective was to expand this principle across the commodities industry and to open up the commodities business to a larger, wider population.

He chose nickel as the first commodity for a very specific reason. It is essential for medical equipment, construction, transportation and more. Many of its uses, for example inside wind turbines and rechargeable batteries, are viewed as vital to the transition to a net zero world.

“With the new industries that are being developed very rapidly, with things like renewable energy and electric vehicles, healthcare, artificial intelligence, nickel seems to be a major raw material for those industries,” Qurashi said.

“There’s going to be a high demand for nickel over the next decade or two.”

This growing demand is already being reflected in its price. Despite a tumultuous year in global markets, the value of nickel in the year-to-date has increased by roughly 33 percent.

Qurashi said that nickel is also an under-produced resource, considering the expected growth in demand in the coming years.

In 2021, the world’s largest nickel producers were Indonesia, the Philippines, the French territory New Caledonia, Russia and Australia. According to GlobalData, 2,427 kilotonnes of nickel were mined in 2021, an uptick of 6.8 percent from 2020. 

Qurashi doesn’t believe that’s enough to satisfy demand moving forward: “Production doesn’t meet demand. Naturally, that means nickel will go up in value.”

As for why he chose Dubai to launch Nikel, Qurashi said not only has he lived there for 16 years, but it’s status as a key hub for cryptocurrencies also played a role.

“We decided to launch the token first in Dubai in view of the Emirate’s status as an emerging crypto hub dedicated to developing a regulatory ecosystem for the growth of the domestic crypto sector.”

He acknowledges that it has been a tough year for many cryptocurrencies and the underlying principles and technologies.

Not only have many of the mainstream cryptocurrencies’ prices dropped precipitously – Bitcoin’s price has fallen nearly 70 percent this year – but the business ecosystem has also been mired by scandal.

In early November, FTX, one of the largest crypto trading platforms, collapsed and with it up to $1 billion in client funds. 

But for Qurashi, blaming the technologies for the actions and behaviour of the people that use, or misuse, them is counterintuitive.

He said: “Just like anything else, when new technology comes out, whether it’s the gold rush or the new dollar being created, you’re always going to get bad drivers. You’re always going to get people who take advantage and make money. That’s what we’re seeing today. It doesn’t mean the technology is bad.

“When you look at things like FTX, I don’t think the technology is bad. Instead, the head of the technology has maybe not done the right things.”