#AbuDhabiStablecoin

The Abu Dhabi Global Market (ADGM) has been actively developing a framework for stablecoins. The Financial Services Regulatory Authority (FSRA) of ADGM issued a consultation paper in August 2024, proposing regulations for fiat-referenced tokens (FRTs). These FRTs, a type of stablecoin pegged to a fiat currency, aim to be a stable medium of exchange within ADGM.

The proposed framework emphasizes reserve asset requirements, ensuring FRTs are backed by high-quality, liquid assets matching the token's currency. It also includes guidelines on governance, transparent disclosure, prudential safeguards, and redemption rights for holders. Algorithmic stablecoins are reportedly prohibited due to their inherent instability.

More recently, in April 2025, major Abu Dhabi institutions, including ADQ, IHC, and First Abu Dhabi Bank (FAB), announced plans to launch a dirham-backed stablecoin, fully regulated by the UAE Central Bank. This initiative will operate on the ADI blockchain and aims to modernize transactions for consumers, businesses, and institutions within the UAE.