First Abu Dhabi Bank (FAB), the largest lender in the UAE by assets, has joined forces with the UAE sovereign wealth fund ADQ and holding company IHC to introduce a new dirham-backed stablecoin. This digital currency is intended for use by consumers, businesses, and institutions, pending regulatory approvals. The stablecoin will be issued by FAB and will be fully regulated by the Central Bank of the UAE, as announced by the three entities on Monday.

This initiative is part of a broader strategy to enhance the digital economy in the UAE and modernize financial transactions. It aligns with the UAE’s vision of positioning itself as a hub for fintech and innovation. Mohamed Hassan Alsuwaidi, Managing Director and Group CEO of ADQ, expressed that the launch of the stablecoin represents a significant step in their commitment to strengthening the digital infrastructure ecosystem in the UAE.

The introduction of this new digital currency is expected to impact various sectors, including finance, commerce, and trade. It will utilize the ADI blockchain, a new technology developed in the UAE by the ADI Foundation, which is anticipated to provide a secure, efficient, and scalable solution for financial transactions.