The United Arab Emirates is set to launch its digital dirham, a central bank digital currency (CBDC), by the fourth quarter of 2025.
Central Bank of the UAE Governor, Khaled Mohamed Balama, shared that the blockchain-based currency will play a significant role in enhancing financial stability and curbing financial crimes. The digital dirham is expected to be integrated into the retail sector and will be accepted alongside the physical dirham in various payment channels.
Balama highlighted that the introduction of the digital dirham would foster the development of innovative digital products, streamline services, and create new business models, all while lowering costs and expanding access to global markets.
Additionally, the digital currency has been rebranded with a new symbol, featuring the letter “D” representing the dirham, paired with two horizontal lines inspired by the UAE flag, symbolizing the currency’s stability.
This move follows the UAE’s earlier steps to regulate stablecoins. In June 2024, the Central Bank of the UAE approved a framework for issuing stablecoins, which paved the way for the creation of dirham-backed stablecoins. Tether, a major stablecoin issuer, announced its collaboration with local firms Phoenix Group and Green Acorn Investments to introduce a stablecoin tied to the UAE dirham. Another player, AED Stablecoin, received approval to issue a regulated dirham-pegged stablecoin.
Other international stablecoins, such as USDC and EURC, have also found a foothold in the UAE, with recognition from the Dubai Financial Services Authority. Meanwhile, Ripple continues to explore the UAE’s stablecoin regulations, with its RLUSD stablecoin already available in the region.
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