UAE Central Bank Approves Dirham-Backed Stablecoin DDSC by IHC, Sirius, FAB

International Holding Company (IHC), Sirius International Holding and First Abu Dhabi Bank (FAB) have received regulatory clearance to issue and operate the stablecoin on ADI Chain, a blockchain infrastructure developed to support institutional-grade digital transactions. The approval allows DDSC to move into live operational status under the supervision of the UAE’s central banking authority.

The stablecoin is designed to be fully backed by the UAE dirham on a one-to-one basis, meaning each token represents an equivalent amount of fiat currency held in reserve. Unlike volatile cryptocurrencies that fluctuate in market value, fiat-backed stablecoins are structured to maintain price stability, making them more suitable for payments, settlement, and treasury applications.

The approval positions DDSC as one of the first centrally authorized dirham-denominated stablecoins in the region. It also signals continued coordination between major financial institutions and regulators as the UAE refines its digital finance strategy.

Syed Basar Shueb, CEO of IHC, said: “DDSC marks a defining milestone in the UAE’s digital finance journey. With the Central Bank’s approval and our transition into live operation, we are delivering trusted, institutional-grade infrastructure that strengthens resilience, accelerates innovation, and expands what is possible in regulated digital payments. As a UAE dirham-backed, programmable stablecoin, DDSC is designed to modernize payments, settlement, and treasury workflows, while enabling secure, automated value transfer, including future machine-to-machine transactions and trade between AI agents as the autonomous economy evolves.”

FAB, which will play a key role in custody and financial backing, underscored the importance of regulatory oversight in integrating digital assets into mainstream financial services. As the country’s largest bank by assets, FAB’s involvement lends institutional weight to the project and may help accelerate enterprise adoption among corporate and government clients.

Futoon Hamdan AlMazrouei, Group Head of Personal, Business, Wealth and Privileged Client Banking Group at First Abu Dhabi Bank (FAB), highlighted the significance of the development in remarks accompanying the announcement. “This milestone underscores that stablecoins can be integrated responsibly into the financial system when built to meet rigorous regulatory and risk requirements. As the UAE’s global bank, FAB is enabling DDSC to seamlessly combine regulatory oversight with blockchain infrastructure, providing secure, scalable solutions that support institutional and government clients across the UAE’s evolving digital economy.”

The stablecoin will operate on ADI Chain, a blockchain network designed to meet governance and compliance requirements for regulated entities. While public blockchains have historically dominated crypto innovation, institutional networks such as ADI Chain are structured to provide tighter oversight, permissioned participation, and operational control, features that regulators and large financial institutions often require.

Ajay Hans Raj Bhatia, Group CEO of Sirius International Holding, described the launch as a turning point for the country’s digital asset ecosystem, emphasizing the broader institutional ambition behind the project. “With DDSC now live, we are entering a new phase of regulated digital finance. Sirius is proud to support this national initiative by helping accelerate adoption and unlock real-world institutional applications, enabled by ADI’s sovereign blockchain infrastructure and underpinned by the UAE’s clear regulatory leadership.”

The approval comes at a time when stablecoins are increasingly viewed as a practical digital extension of fiat currency rather than purely speculative crypto instruments. Globally, regulators have been working to define clearer frameworks for tokenized money, particularly in areas involving reserve transparency, redemption rights, and systemic risk safeguards. Within that context, the UAE’s authorization of a dirham-backed token reflects a measured, regulator-led approach.

Rather than introducing a central bank digital currency directly into retail circulation, DDSC represents a privately issued but centrally supervised digital token. This model allows financial institutions to experiment with programmable payments and blockchain-based settlement while maintaining alignment with existing monetary policy structures.

The stakeholders involved have indicated that DDSC is expected to support a range of use cases, including high-value payments, cross-border settlement, and treasury management. The programmable nature of blockchain infrastructure also opens the possibility of automated financial workflows, where transactions can be executed according to predefined conditions.

The UAE has consistently positioned itself as a regional hub for fintech and digital assets, and this approval reinforces its strategy of pairing innovation with regulatory clarity. In recent years, authorities have introduced structured licensing regimes covering virtual asset service providers, payment tokens, and digital financial infrastructure. The DDSC authorization builds on that foundation by integrating a stablecoin directly into the regulated banking ecosystem.

What distinguishes this development is not merely the creation of another stablecoin, but the formal approval from the country’s central monetary authority. That regulatory endorsement may serve as a signal to both domestic and international institutions that the UAE intends to anchor digital asset innovation within established legal and financial frameworks.

Now that approval is in place, attention turns to execution. The real measure of success will depend on how quickly institutions begin using DDSC, how reliably reserves are managed, and how smoothly it connects with existing payment systems. Those factors will shape whether the stablecoin becomes a lasting part of the UAE’s evolving digital economy.

The central bank’s green light marks a clear step forward in the country’s effort to modernize settlement systems while maintaining regulatory oversight, an approach that balances technological advancement with financial stability.