ADQ, IHC, and FAB represent a powerful cross-section of the UAE economy: ADQ manages over $150 billion in sovereign assets, IHC is a global investment holding giant with diverse interests ranging from health care to agriculture, and FAB is the country’s largest bank by assets. Their combined expertise is expected to provide the financial strength, operational capabilities, and technological backbone necessary to make the stablecoin a success.
The three entities plan to operate the stablecoin through a new venture called DTR (short for "Distributed Technologies Research"), a UAE-based startup tasked with managing issuance and technical development. DTR has already secured regulatory approval for operations.
The UAE’s regulatory landscape has been a key enabler of this project. Over the past two years, the Central Bank and other regulatory bodies have introduced several initiatives to foster innovation while safeguarding the financial system. The Payment Token Services Regulation, launched in early 2024, clearly outlines requirements for token issuers, exchanges, and custody providers operating with stablecoins and digital assets.
Under these new guidelines, stablecoin issuers must maintain full reserves, meet strict auditing standards, and comply with anti-money laundering and counter-terrorist financing rules—setting a high bar for transparency and consumer protection.
DTR’s new stablecoin will follow in the footsteps of the UAE's recently launched AE Coin, another dirham-backed stablecoin approved by the Central Bank. However, industry insiders believe that the backing of Abu Dhabi’s financial heavyweights will allow the DTR stablecoin to scale much faster and integrate more deeply into mainstream banking and commerce.
The move is widely seen as part of the UAE's broader strategy to diversify its economy away from hydrocarbons and establish itself as a global hub for finance, fintech, and blockchain innovation.
Several strategic implications arise from the launch of the dirham-backed stablecoin. One major impact could be on cross-border payments. A stablecoin tied to the dirham could dramatically reduce costs and settlement times for international transactions, particularly between Gulf Cooperation Council (GCC) countries, Asia, and Africa, where the UAE already serves as a key trade intermediary. By streamlining transactions, the stablecoin could enhance the UAE’s role as a financial hub for regional and global commerce.
Another significant implication is the strengthening of the dirham’s global role. By creating a stablecoin with global utility, the UAE could increase the international usage of the dirham in digital commerce and cross-border remittances. This expanded role would not only boost the dirham’s prominence in global financial markets but also enhance the UAE’s economic influence and soft power on the world stage.
Financial inclusion and innovation also stand to benefit. With the continued rise of mobile banking and blockchain-based financial services, a stable, accessible digital currency could help extend financial services to underbanked and underserved populations across the Middle East and North Africa (MENA) region. The stablecoin could offer a secure, efficient, and low-cost alternative to traditional banking infrastructure, promoting greater economic participation.
Finally, the initiative highlights the UAE’s commitment to technological leadership. By embracing cutting-edge solutions like blockchain and smart contracts for real-world financial applications, the UAE is positioning itself as a pioneer in digital finance. This focus on innovation not only supports the country’s broader economic diversification goals but also cements its status as a leader in the global fintech ecosystem.
While ADQ, IHC, and FAB have not yet disclosed a precise launch date for the stablecoin, insiders suggest that a pilot rollout could occur as early as late 2025, initially focusing on institutional clients before expanding to retail users.
Initial reactions from the digital asset industry have been positive. Analysts note that the involvement of such heavyweight institutions lends strong credibility to the project. However, some have cautioned that the venture's success will depend on its ability to gain broad adoption beyond the UAE, integrate with international blockchain networks, and compete with dollar-backed stablecoins such as USDC and USDT, which dominate global crypto trading volumes.
Meanwhile, the UAE's progress contrasts with slower stablecoin developments in jurisdictions like the European Union and the United States, where regulatory uncertainty continues to hinder innovation.
The planned launch of a dirham-backed stablecoin by Abu Dhabi's leading institutions marks a bold step toward digital economic transformation. It exemplifies the UAE's ambitions to lead not only in oil and trade but also in the rapidly evolving world of digital assets and blockchain-powered finance.
If successful, the initiative could set a template for how stablecoins are adopted at the national level and how digital currencies can complement traditional banking systems while fostering greater global financial inclusion.
The move aligns with the UAE's push to diversify its economy and become a global hub for finance, fintech, and blockchain. (Image via Shutterstock)
