#AbuDhabiStablecoin 👇🏻💥🚀

Abu Dhabi is making significant strides in regulating stablecoins, particularly fiat-referenced tokens (FRTs), to enhance financial stability and investor confidence. In December 2024, the Financial Services Regulatory Authority (FSRA) of the Abu Dhabi Global Market (ADGM) formalized a comprehensive regulatory framework for FRTs, following extensive industry consultation.

Key provisions of the framework include:

💥Reserve Requirements: Issuers must maintain reserve assets equal to or exceeding the total value of FRTs in circulation, valued daily on a mark-to-market basis.

💥Segregation of Assets: For issuers managing multiple FRTs, separate pools of reserve assets must be maintained and managed independently to prevent cross-contamination.

💥Redemption Rights: FRT holders have the right to redeem their tokens at par value, with issuers required to process redemption requests within two business days.

💥Transparency and Disclosure: Issuers are obligated to provide detailed whitepapers and ongoing disclosures covering operational aspects, risks, and rights of FRT holders.

In a parallel development, the Central Bank of the UAE approved AE Coin, the nation’s first dirham-pegged stablecoin, in December 2024. AE Coin is fully backed by reserves held within the UAE, aiming to provide stability and efficiency in digital transactions.

These initiatives underscore Abu Dhabi’s commitment to fostering a secure and innovative digital asset ecosystem, positioning the UAE as a leader in the global crypto landscape. #AbuDhabiStablecoin