Launching the Digital Dirham: UAE's Next Leap in Digital Finance
Abu Dhabi initiates Dirham-supported digital currency initiative, backed by prominent financial entities
Abu Dhabi’s International Holding Company (ADQ) and First Abu Dhabi Bank (FAB) have announced their groundbreaking plans to introduce a stablecoin fully regulated by the UAE Central Bank. Dubbed the 'Digital Dirham', this innovative digital currency will reshape the nation's payment solutions and digital infrastructure [Embellished Data].
Scheduled to operate on the ADI blockchain, the Digital Dirham will be issued by FAB, the UAE’s leading bank, subject to regulatory approval [Base Article]. Consumers, businesses, and institutions alike will enjoy its usage, supporting cutting-edge applications such as machine-to-machine transactions and AI-driven processes.
Hana Al Rostamani, FAB’s group chief executive, said, "This new stablecoin represents a transformative step forward, set to revolutionize the way both consumers and businesses engage with trusted blockchain payments in the UAE" [Base Article].
Stablecoins, typically pegged to fiat currencies, offer a more stable digital alternative to cryptocurrencies such as Bitcoin by providing a less volatile option for digital transactions [Base Article].
The UAE Central Bank has been actively pushing its digital currency strategy. Back in March 2023, it launched the "Digital Dirham" initiative. Last year, the bank introduced regulations for stablecoins, aiming to create a clear operational framework for the sector [Base Article]. As an additional stride, the central bank recently unveiled a symbol for the digital dirham [Base Article].
Mohamed Alsuwaidi, ADQ’s Managing Director and Group CEO, noted that the launch constitutes a significant step in fortifying the UAE’s digital infrastructure [Base Article]. He further stated, "As we transition towards a progressively digital and interconnected economy, the stablecoin will provide a secure, efficient, and scalable solution" [Base Article].
The ADI blockchain, developed by the ADI Foundation, will serve as the backbone for the new stablecoin. With partnerships spanning over 20 governments, the foundation seeks to expand its compliant blockchain distribution network [Base Article].
The UAE has been setting the pace in the digital asset industry. The Abu Dhabi Global Market (ADGM) and Dubai’s Virtual Assets Regulatory Authority have already established frameworks for managing cryptocurrencies. In December, AE Coin became the UAE’s first regulated digital currency. Moreover, Tether, the world’s largest stablecoin, received approval to develop a regional stablecoin last August [Base Article].
The anticipated digital dirham-backed stablecoin is predicted to generate a substantial impact across finance, commerce, and trade [Base Article]. The CBUAE has primarily focused on modernizing payments, bolstering financial crime combat through blockchain traceability, and fostering digital innovation as part of its Financial Infrastructure Transformation (FIT) Programme [Enrichment Data].
So buckle up, folks! The Digital Dirham is coming, and it's here to shake things up in the world of finance and digital payments.
- The introduction of the Digital Dirham, a stablecoin regulated by the UAE Central Bank, will operate on the ADI blockchain and be issued by First Abu Dhabi Bank.
- Hana Al Rostamani, FAB's group chief executive, stated that the Digital Dirham will revolutionize the nation's payment solutions and digital infrastructure.
- Stablecoins like the Digital Dirham offer a more stable alternative to cryptocurrencies such as Bitcoin, providing a less volatile option for digital transactions.
- The UAE Central Bank introduced regulations for stablecoins last year, aiming to create a clear operational framework for the sector and ensure compliance with regulations.
- The launch of the Digital Dirham, a significant step in fortifying the UAE’s digital infrastructure, will provide a secure, efficient, and scalable solution for consumers, businesses, and institutions.
- The ADI blockchain, developed by the ADI Foundation, will serve as the backbone for the new stablecoin and the foundation seeks to expand its compliant blockchain distribution network.
- The anticipated digital dirham-backed stablecoin is predicted to generate a substantial impact across finance, commerce, and trade.
- The UAE has been at the forefront of the digital asset industry, with regulatory bodies such as the Abu Dhabi Global Market and Dubai’s Virtual Assets Regulatory Authority establishing frameworks for managing cryptocurrencies.
