Central Bank of the UAE Approves First USD-Backed Stablecoin

The Central Bank of the United Arab Emirates (UAE) stated Thursday that it has accepted first US dollar-backed stablecoin – dubbed USDU, enabling compliant settlements for cryptos and derivatives.

According to a press release, the stablecoin maintains 1:1 reserves backing, safeguarded in onshore accounts at companion banks. The token is issued and managed by a regulated entity, Universal Digital.

Universal’s banking companions embody Emirates NBD and Mashreq, with month-to-month impartial attestation. Meanwhile, Mbank serves as strategic banking companion.

Further, Aquanow, a crypto infrastructure agency, serves as a world distribution companion. It additionally helps skilled purchasers’ entry to USDU exterior the UAE wherever permitted.

“Being the first Foreign Payment Token registered by the UAE Central Bank – and supported by main UAE banks – offers establishments the readability and confidence they’ve been ready for,” stated Juha Viitala, CEO at Universal Digital.

USDU Stablecoin Addresses Institutional Demand

The stablecoin addresses institutional demand for regulatory transparency in digital property, the launch stated.

USDU probably reduces cross-border settlement prices, enhancing MENA’s competitiveness in the world stablecoin market.

Stablecoins have been gaining vital traction throughout the Middle East area. The Central Bank of the UAE granted in-principle approval for AED stablecoin in 2024. Under the new Payment Token Services Regulation, the dirham-pegged AE Coin capabilities as each a neighborhood buying and selling pair and a broadly accepted cost methodology for on a regular basis transactions inside the UAE.

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