#AbuDhabiStablecoin **Abu Dhabi's Dirham-Backed Stablecoin Initiative: Key Developments**
Abu Dhabi is accelerating its position as a global leader in digital finance with the launch of a UAE dirham (AED)-backed stablecoin, developed through a collaboration between major institutions. Here’s an in-depth analysis of the project and its broader implications:
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### **1. Strategic Partnerships and Regulatory Framework**
- **Key Players**: Abu Dhabi’s sovereign wealth fund **ADQ**, conglomerate **IHC**, and **First Abu Dhabi Bank (FAB)** are leading the initiative. The stablecoin will be issued by FAB and regulated by the UAE Central Bank (CBUAE).
- **Regulatory Compliance**: The project adheres to the CBUAE’s 2023 stablecoin regulations, which provide clarity on issuance, liquidity, and risk management. Non-dirham stablecoins are permitted but restricted to virtual asset transactions.
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### **2. Technical Infrastructure and Use Cases**
- **ADI Blockchain**: The stablecoin will operate on the **ADI blockchain**, a UAE-developed platform designed for secure, transparent, and scalable transactions. This blockchain supports emerging technologies like AI-driven processes and machine-to-machine payments.
- **Functionality**: Aimed at retail and institutional users, the stablecoin will facilitate everyday payments, cross-border remittances, and innovative use cases such as automated supply-chain settlements.
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### **3. Timeline and Market Positioning**
- **Launch Plan**: The stablecoin is expected to debut in Q4 2025 for retail use, pending final CBUAE approval.
- **Competitive Landscape**: It will compete with existing dirham-pegged stablecoins like **AE Coin** (launched in 2024) and international offerings such as Tether’s planned UAE stablecoin.
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### **4. Broader Ecosystem Developments**
- **Circle’s Expansion**: USDC issuer Circle received in-principle approval from Abu Dhabi’s **ADGM Financial Services Regulatory Authority** to operate as a money services provider. This aligns with the UAE’s strategy to attract glob
