The Central Bank of the UAE has approved the first AED stablecoin, which is set to launch soon. This news comes after the central bank released its payment token services framework, paving the way for the acceptance of local stablecoins. The AE Coin, as it is called, is expected to revolutionize the financial services landscape in the UAE by offering instant, secure, stable, innovative, low-cost, and efficient payment experiences. This development is poised to reshape the future of the digital economy in the region.
AE Coin aims to empower individuals and businesses by providing access to modern financial tools, fostering financial inclusion, and supporting innovation in industries such as e-commerce, remittances, and decentralized finance (DeFi). The stablecoin, with each unit equivalent to one UAE Dirham, harnesses the speed and efficiency of blockchain technology to offer instant, secure, and cost-effective transactions. Ramez Rafeek, General Manager of AED stablecoin, highlighted the transformative potential of AE Coin in simplifying transfers and setting a new standard for trust, security, and innovation in digital currency.
In addition to AE Coin, Tether has also announced its plans to launch an AED-backed stablecoin in partnership with Green Arcon Investments Ltd and Phoenix Group PLC. This move signals further growth in the stablecoin market in the UAE, which saw a significant increase in value of stablecoins received by services in 2024. Stablecoins now account for the largest share of crypto activity in the UAE, surpassing Bitcoin and Ether in popularity and recognition. Retail-sized transfers make up the majority of stablecoin transactions in the UAE, indicating a highly active market for retail investors using stablecoins to trade in virtual assets.
The launch of the first AED stablecoin in the UAE marks a significant milestone in the digital currency landscape of the region. With the Central Bank’s approval, AE Coin is poised to revolutionize financial services by offering secure, efficient, and innovative payment experiences to individuals and businesses. This development is set to foster financial inclusion and support innovation in key industries such as e-commerce, remittances, and DeFi. As the stablecoin market in the UAE continues to grow, with Tether also entering the space, stablecoins are becoming increasingly popular among investors and traders in the region.
The introduction of AE Coin and the upcoming AED-backed stablecoin by Tether highlight the growing importance of stablecoins in the UAE’s digital economy. With stablecoins accounting for the largest share of crypto activity in the region, they have become a popular choice for retail investors looking to trade in virtual assets. The launch of these stablecoins reflects a broader trend towards digital innovation and adoption of blockchain technology in the UAE, positioning the country as a hub for financial innovation and technological advancement in the region and beyond.
