IHC, ADQ, and FAB to launch a UAE-regulated, dirham-backed stablecoin on ADI blockchain.
FAB will issue the new stablecoin, pending approval from the UAE Central Bank.
The stablecoin will support AI-driven and machine-to-machine digital payment solutions.
The stablecoin project will be launched by Abu Dhabi entities International Holding Company (IHC), ADQ, and First Abu Dhabi Bank (FAB), which plans to back the coin with UAE dirham. Digital currency operates under regulation by the UAE Central Bank to advance payment solutions.
FAB's stablecoin project depends on regulatory approval for its launch as the UAE's largest banking institution. The ADI blockchain developed by the UAE maintains the stablecoin framework, while the ADI Foundation handles blockchain operations. The blockchain system operates as a compliant infrastructure for blockchain transactions, with support from more than 20 nations as government partners.
ADQ’s Managing Director and Group CEO, Mohamed Alsuwaidi, highlighted how stablecoins can strengthen the UAE’s digital foundation. The project introduces secure scaling solutions for digital economies while creating new business possibilities and value for the growing economy.
Digital Currency to Support AI and Machine Transactions
The new stablecoin aims to serve all sectors, from individual consumers to business organizations and institutional buyers. It supports next-generation digital applications because it supports artificial intelligence operations and machine-to-machine transactions. The companies that have adopted with anticipation it will streamline all business payments, whether domestic or international.
https://twitter.com/ihc__official/status/1916909683904024953
As FAB's Group Chief Executive, Hana Al Rostamani, states, the project represents a transformative step that can revolutionize digital payments in the UAE. She noted that the currency would revolutionize all financial and commercial operations while creating a dependable digital money system for transactions.
Stablecoins achieve their stability through a direct linkage between their value and traditional currencies, government securities, or precious metals as commodities. These payment designs outperform Bitcoin by restricting price volatility, which makes them suitable for regular financial uses.
UAE Strengthens Digital Currency Regulations
The UAE Central Bank launched its "Digital Dirham" strategy under its digital currency development framework in March 2023. The central bank implemented particular regulations throughout last year which provided explicit operational standards for stablecoins and digital assets.
The Abu Dhabi Global Market (ADGM) and the Virtual Assets Regulatory Authority (VARA) in Dubai have built regulatory structures for cryptocurrency operations. These organizations established a positive regulatory landscape that substantially supported digital currency development.
The UAE's first regulated digital currency, AE Coin, was approved in December, while its anticipated public rollout is nearing. The UAE government approved Tether's local USDT development, demonstrating its growing acceptance of digital currencies.