#AbuDhabiStablecoin Abu Dhabi, through the Financial Services Regulatory Authority (FSRA) of the Abu Dhabi Global Market (ADGM), has established a comprehensive regulatory framework for fiat-referenced tokens (FRT), commonly known as stablecoins. This framework, introduced in December 2024 and based on previous regulations, aims to provide a solid structure for the issuance and management of stablecoins, emphasizing stability, transparency, and investor protection while fostering innovation in digital finance.
The FSRA classifies the issuance of FRT as a distinct regulated activity, imposing strict compliance requirements on issuers. These include maintaining a full reserve backing in the referenced fiat currency, implementing robust governance protocols, and ensuring operational transparency to protect users and maintain market integrity. Algorithmic stablecoins are prohibited due to their perceived instability.
Recently, in April 2025, a significant development emerged with the announcement of a new dirham-backed stablecoin project. This initiative involves collaboration between Abu Dhabi Developmental Holding Company (ADQ), International Holding Company (IHC), and First Abu Dhabi Bank (FAB). Fully regulated by the Central Bank of the UAE, this stablecoin will operate on the ADI blockchain and aims to facilitate daily consumer transactions and AI-based processes, marking an important step in the UAE's digital asset strategy. This complements existing regulatory efforts and positions Abu Dhabi as a pioneering hub for the innovation and adoption of stablecoins in the Middle East.
