Abu Dhabi institutional giants team up for dirham stablecoin

Three major Abu Dhabi institutions-sovereign wealth fund ADQ, conglomerate International Holding Company (IHC), and First Abu Dhabi Bank (FAB)-have announced a partnership to launch the UAE’s first fully regulated dirham-backed stablecoin, pending approval from the Central Bank of the UAE (CBUAE).

The stablecoin will be pegged 1:1 to the UAE dirham and operate under CBUAE oversight, ensuring compliance and consumer protection.

It will run on the ADI blockchain, developed by the nonprofit ADI Foundation, which focuses on advancing blockchain adoption in financial systems.

The stablecoin is designed for retail, institutional, and emerging applications like machine-to-machine payments and AI-driven transactions.

FAB, the UAE’s largest bank, will issue the stablecoin, leveraging its credibility to ensure trust and adoption.

This initiative aims to position the UAE as a leader in blockchain innovation and digital finance, complementing existing efforts like the CBUAE’s "Digital Dirham" project and recent regulatory frameworks for stablecoins.

The move follows the December 2023 launch of AE Coin, the UAE’s first regulated dirham-backed stablecoin, and aligns with broader regional trends to reduce reliance on dollar-denominated stablecoins like USDT.

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