The finance, commerce, and trade industries are projected to be major beneficiaries of this stablecoin.
The timeline for this stablecoin’s rollout remains awaited for now
Photo Credit: ADGM
A group of Abu Dhabi-based institutions on Monday announced plans to launch a stablecoin, pegged to the United Arab Emirates Dirham (AED). The group comprises Abu Dhabi's ADQ sovereign wealth fund, the First Abu Dhabi Bank (FAB), and investment firm International Holding Company (IHC). The stablecoin will be regulated by the Central Bank of the United Arab Emirates (CBUAE). The group aims to introduce stablecoins into UAE's payment ecosystems.
ADQ announced that the upcoming stablecoin will be promoted as a digital currency that can be used by citizens, consumers, businesses, and institutions. The stablecoin is also expected to support transactions between machines and AI models in the UAE.
“As we move forward towards an increasingly digital and connected economy, [the] stablecoin will provide a solution that is secure, efficient, and scalable, while creating new opportunities for growth and value creation,” said Mohamed Hassan Alsuwaidi, ADQ MD and Group CEO, in a prepared statement.
The token will be supported on the ADI blockchain, developed by an Abu Dhabi-based non-profit firm called the ADI Foundation. The CEO of the firm said that because the ADI blockchain is developed within the UAE, it will ensure security and transparency within the stablecoin ecosystem.
The finance, commerce, and trade industries are projected to be major beneficiaries of this stablecoin. The token is also expected to establish the UAE as an early adopter of stablecoins, which are being subject to regulations in several parts of the world, including the US.
It's worth noting that the group has yet to announce a timeline of the rollout of this stablecoin.
While Dubai has secured itself as a Web3 hotspot, overseen by the dedicated VARA regulatory authority, Abu Dhabi has also taken various steps to strengthen its foothold in the Web3 arena.
Earlier in March, the Abu Dhabi Global Market (ADGM) signed an MoU with Chainlink to enhance Web3 awareness and explore advanced blockchain use cases.
The Abu Dhabi-based sovereign wealth management fund MGX purchased a minority stake in Binance for $2 billion (roughly Rs. 17,403 crore), making it the first second-party stakeholder of what's touted as the world's largest crypto exchange.
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