The Central Bank of the United Arab Emirates has approved the country’s first USD-backed stablecoin, marking a key step in the regulation of digital assets and payment tokens in the UAE.
The USDU stablecoin has been approved under the central bank’s Payment Token Services Regulation. It is issued and managed by Universal Digital, a crypto firm regulated by the Financial Services Regulatory Authority of Abu Dhabi Global Market. The company said it has become the first foreign payment token issuer registered with the central bank.The approval positions the UAE among the first major financial jurisdictions to implement a fully regulated framework for USD-denominated settlement using digital assets. Universal Digital said the launch of USDU represents a milestone in the development of regulated digital asset infrastructure in the country.
A stablecoin is a type of cryptocurrency designed to maintain a stable value by being pegged to a reserve asset, most commonly a fiat currency such as the U.S. dollar. Unlike more volatile cryptocurrencies, stablecoins aim to reduce price fluctuations, making them more suitable for payments, settlements and cross-border transfers while operating on blockchain-based systems.
