CBUAE approves dirham-backed stablecoin as UAE accelerates institutional blockchain push
Abu Dhabi, United Arab Emirates – May 20, 2026. The Central Bank of the UAE (CBUAE) approved DDSC, a UAE dirham-backed stablecoin operating on ADI Chain, marking the nation’s first regulatory greenlight for a sovereign-currency digital asset designed for institutional settlements. The move positions Abu Dhabi as a regulated alternative to offshore crypto hubs.
Overview
International Holding Company (IHC), subsidiary Sirius International Holding, and First Abu Dhabi Bank (FAB) received CBUAE approval to launch DDSC on ADI Chain, a Layer-2 blockchain built by Abu Dhabi’s ADI Foundation. The project, first announced in April 2025, targets cross-border payments, high-value settlements, trade finance, and programmable treasury functions. Initial access is limited to FAB customers on approved platforms, with specific transaction volumes undisclosed.
Expert perspective
“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…”
— Syed Basar Shueb, CEO of IHC
This framing positions DDSC as infrastructure rather than speculative asset, aligning with CBUAE’s 2023 Payment Token Services regulations that require full AED reserves and real-time audits.
“This milestone underscores that stablecoins can be integrated responsibly into the financial system when built to meet rigorous regulatory and risk requirements.”
— Futoon Hamdan AlMazrouei, Group Head at FAB
FAB’s emphasis on “rigorous regulatory requirements” contrasts with Tether and Circle’s lighter-touch jurisdictions, potentially attracting institutions wary of compliance gaps.
Why this matters
DDSC represents the UAE’s bet that regulated stablecoins can capture institutional flows avoiding algorithmic risks (UST collapse) and reserve opacity (Tether audits). By anchoring DDSC to a G20-supervised central bank framework, Abu Dhabi targets the $170 billion global stablecoin market’s enterprise segment—CFOs needing instant settlement without crypto volatility.
For MENA, this directly supports Dubai’s D33 economic agenda and Saudi Arabia’s Financial Sector Development Program under Vision 2030, both prioritizing fintech infrastructure. Regional corporates managing multi-currency trade invoices could settle in tokenized dirhams, bypassing SWIFT delays.
What’s next
FAB’s customer adoption metrics and whether ADGM-licensed fintechs integrate DDSC for payroll or remittances. ADI Chain’s roadmap for expanding beyond payments into tokenized securities will test institutional appetite.
The approval follows global momentum: the EU’s MiCA framework takes effect June 2024, while Hong Kong licensed its first stablecoin issuer in January 2025. DDSC’s compliance-first model may set the MENA standard.
Conclusion
DDSC transforms the UAE from digital asset experimenter to regulated infrastructure provider, with FAB’s distribution network offering immediate scale unavailable to purely crypto-native projects.
