Embargoed until January 29, 10am (GST)
The Central Bank of the United Arab Emirates (CBUAE) has approved the country’s first U.S. dollar-backed stablecoin under the bank’s Payment Token Services Regulation (PTSR), according to a press release on Thursday.
The issuance and management of USDU tokens is handled by Universal Digital, which is regulated by the Financial Services Regulatory Authority (FSRA) of the Abu Dhabi Global Market (ADGM).
Reserves backing USDU are held at a 1:1 ratio in protected onshore accounts at global banking partners Emirates NBD and Mashreq, as well as Mbank.
The regulatory move means the U.S. dollar stablecoin is now up and running under the central bank’s payments regime, putting the UAE ahead of the United States, the European Union and much of Asia, the press release said.
“USDU sets a new benchmark for regulated digital value,” said Juha Viitala, senior executive officer at Universal. “As the first foreign payment token registered by the Central Bank of the UAE and backed by the UAE’s leading banks, it provides institutions with the clarity and confidence they have been waiting for. It lays the foundation for a more transparent and efficient digital asset market in the UAE and beyond.”
Universal said digital asset infrastructure company Aquanow has been appointed as a global distribution partner to enable institutions outside the UAE to access USDU where permitted.
Joel Van Dusen, group head of corporate and investment banking at Mashreq, said: “We are seeing growing institutional interest in regulated digital value instruments and Universal’s launch of USDU is a timely step to support the maturation of this market.”
