UPDATED: UAE's First Dirham-Backed Digital Coin Receives Green Light

Temporary approval given to AED from UAE Central Bank
October 16, 2024 by
UPDATED: UAE's First Dirham-Backed Digital Coin Receives Green Light
DxTalks, Ibrahim Kazeem

AED Stablecoin LLC has received initial approval from the Central Bank of the UAE to launch AE Coin, the first stable digital currency backed by the UAE dirham. This move is part of the country's efforts to strengthen its digital economy and aligns with the UAE Digital Government Strategy 2025.

AE Coin, a fiat-backed stablecoin, will be fully tied to the dirham, offering users the speed of blockchain technology along with the security of traditional currency. It promises to simplify secure payments and contribute to the UAE's growing digital market.

This is a significant milestone, as AE Coin becomes the first cryptocurrency regulated by the Central Bank of the UAE. It is backed by transparent reserves, regularly audited, which helps ensure stability and reduce the risks often associated with cryptocurrencies. AE Coin will also support decentralized finance (DeFi), allowing users to engage in activities like lending, borrowing, and earning interest.

Built on cutting-edge blockchain technology with multi-layer encryption, AE Coin offers secure, transparent transactions. It also aims to make digital payments easier with future plans including a mobile wallet and partnerships with merchants to expand its use.

"We are excited to receive the Central Bank’s approval to issue AE Coin," said Ramez Rafeek, General Manager of AED Stablecoin. "As the first regulated stablecoin in the UAE, AE Coin will bring financial freedom and reliability to the digital currency world."

With AE Coin, businesses and individuals can look forward to faster, low-cost transactions under strict regulatory oversight. This positions AE Coin as a key player in the UAE’s move toward a modern, digital economy. The coin is set to improve cash flow for companies and offer a secure option for everyday transactions for individuals. Future goals include partnering with financial institutions and expanding its reach through decentralized apps and cryptocurrency exchanges.

The launch of AE Coin marks a new chapter in the UAE’s financial landscape, blending stability and innovation in one digital solution.

What does this mean for other stable coins?

The launch of AE Coin, backed by the UAE dirham and approved by the Central Bank, raises the bar for other stablecoins in the region. It sets a new standard by being the first to operate under official regulation, offering users more security and trust. This could push other stablecoin projects to seek similar regulatory approval to stay competitive.

Additionally, AE Coin’s focus on local partnerships and wide use in payments may encourage other stablecoins to strengthen their regional presence or face losing ground in the UAE’s growing digital economy.