Circle issuer of the $600 million USDC stablecoin secures in-principle approval from Abu Dhabi’s financial watchdog

The greenlight arrives as global demand for stablecoins skyrockets, with USDC’s supply swelling over 40% this year.

In a move that could reshape digital finance in the Middle East, Abu Dhabi’s financial watchdog has granted Circle, issuer of the $62 billion USDC stablecoin, in-principle approval to operate as a licensed money services provider.

The Abu Dhabi Global Market’s (ADGM) Financial Services Regulatory Authority (FSRA) has begun the process of approving Circle to provide money services in the emirate, it announced on Saturday. The company, which was incorporated in ADGM last December, is now applying for full licensure to provide remittance and payment services in the UAE.

“This approval advances our strategy to establish deep roots in markets embracing the on-chain economy,” said Circle CEO Jeremy Allaire.

The move underscores Abu Dhabi’s ambition to become a leading crypto hub, balancing innovation with stringent oversight. It comes as global demand for stablecoins is surging, with USDC’s supply increasing over 40% in 2025.

"We are committed to providing a regulatory framework that supports responsible innovation in financial services and promotes the development of a diverse and competitive market in Abu Dhabi," said Arvind Ramamurthy, CEO of FSRA.

ADGM's rigorous compliance checks ensure only vetted players like Circle can participate in its financial ecosystem. The regulator conducts a comprehensive assessment of applicants' business model, management team, and operations to align with FSRA's regulatory requirements and standards.

"This emphasis on credibility is critical for enabling institutional adoption of Web3 technologies and products," added Dante Disparte, chief strategy officer and head of global policy at Circle.

The approval for USDC marks a turning point in Abu Dhabi's journey to become a global fintech base, according to Ahmad Ali Alwan, CEO of Hub71, which is supporting Circle's integration into the emirate's tech ecosystem.

"We are seeing more and more startups choose Hub71 to launch and scale their businesses thanks to the incredible support from the government and the pro-business environment in Abu Dhabi," Alwan said.

Earlier this year, Circle and LuLu Financial Holdings announced plans to use USDC for cross-border payments between the Middle East, Asia, and Europe. The partnership will streamline remittances and reduce costs, especially for high-volume corridors.

"Together, we will create a seamless and efficient ecosystem that fosters groundbreaking solutions to some of the most pressing issues facing the industry today," said Alwan.

As part of the partnership, Hub71 will provide startups with access to grants, mentorship programs, and the ADGM regulatory sandbox, enabling them to develop and test innovative financial solutions.

The partnership aligns with the UAE's $2 billion investment plan to develop blockchain technology and cryptocurrencies.

"Abu Dhabi is committed to becoming a global fintech base and offers a unique proposition to startups and investors in the Web3 space with its advanced infrastructure, sophisticated legal and regulatory framework, and a low-to-no-tax regime, especially for crypto trades," added Alwan.

Earlier this week, Circle launched its new cross-border payments network, which will connect banks and fintech firms for real-time transactions using USDC. The move is part of broader efforts to integrate USDC into mainstream finance.

Earlier this year, Circle became the first stablecoin issuer to fully comply with the European Union's (EU) Markets in Crypto-Assets (MiCA) regulations. It also launched USDC in Japan through a partnership with SBI Holdings.

These developments highlight Circle's strategy of prioritizing jurisdictions that have clear and comprehensive cryptocurrency regulations in order to attract institutional investors.

ADGM's financial services regulator is known for its robust standards, having previously rejected an application from a crypto exchange, highlighting the competitive landscape in Abu Dhabi's crypto market.

Despite securing in-principle approval, Circle still needs to complete the full licensing process in Abu Dhabi, which could be subject to further checks and potential delays.

The move comes as U.S. officials are probing whether Circle mishandled customer funds, adding another layer of complexity to the firm's plans.

However, the in-principle nod from Abu Dhabi strengthens Circle's case as it navigates a U.S. initial public offering (IPO) quiet period. The firm also faces scrutiny over its handling of customer funds.

"We have no regional plans to disclose at this time," a Circle spokesperson told.

The Middle East nation's crypto market is expected to reach $254 million by 2025, driven by the government's pro-innovation policies and the ambition of financial institutions to integrate digital assets.

The post Abu Dhabi greenlights Circle's USDC operations in landmark move for crypto hub appeared first on Chain Teller.

According to a report by Bloomberg, the U.S. officials are probing whether Circle mishandled customer funds in a manner that could have violated federal law.

The report, which cites two people familiar with the matter, adds that the inquiry by