UAE to Launch Digital Dirham CBDC in Q4 2025
The Central Bank of the UAE (CBUAE) has announced that it will roll out its Digital Dirham, a central bank digital currency (CBDC), in the fourth quarter of 2025. The retail version of the CBDC will serve as legal tender, meaning businesses and individuals will be required to accept it for payments. The central bank also plans to leverage the Digital Dirham for wholesale and cross-border transactions.
Alongside the currency launch, the CBUAE will introduce a Digital Dirham wallet. While other regions, such as Europe, are focusing on everyday transactions, the UAE’s approach appears more geared toward financial applications.
The blockchain-based CBDC will be distributed through banks, exchanges, financial institutions, and fintech companies. The central bank sees tokenization and fractionalization as key drivers of financial inclusion. Additionally, smart contract programmability will enable automated transactions and atomic settlement, improving efficiency in financial markets.
The UAE has been a strong advocate for blockchain and cryptocurrency, with financial hubs like Dubai’s DIFC and Abu Dhabi’s ADGM fostering a supportive regulatory environment. In line with this, state-backed MGX recently invested in Binance, reinforcing the nation’s commitment to digital finance.
“It is anticipated that the Digital Dirham, as a blockchain-based platform with cutting-edge capabilities, will substantially enhance financial stability, inclusion, and resilience while combating financial crime,” said H.E. Khaled Mohamed Balama, Governor of the CBUAE.
“It will further enable the development of innovative digital products, services, and new business models, while reducing costs and expanding access to international markets.”
