The United Arab Emirates is Launching its Digital Dirham by Q4 2025

The United Arab Emirates is set to launch its digital dirham, a central bank digital currency (CBDC), by the fourth quarter of 2025.

The United Arab Emirates is gearing up to launch its highly anticipated central bank digital currency (CBDC), the digital dirham, by the fourth quarter of 2025, a senior official stated on Monday.

Speaking at the Mena Fintech Association’s Mena Fintech Connect in Dubai, Central Bank of the UAE Governor Khaled Mohamed Balama shared that the currency, built on blockchain technology, will be a crucial factor in boosting financial stability and curbing financial crimes.

It is set to be used in the retail sector and will be accepted alongside the physical dirham in various payment channels.

Balama added that the introduction of the digital dirham would, in turn, facilitate the development of innovative digital products, streamline services, and pave the way for new business models, all while cutting costs and increasing access to global markets.

The digital currency has also been rebranded with a new symbol, featuring the letter “D” standing for the dirham, combined with two horizontal lines, which is a segment of the UAE flag, signifying the currency’s stability.

This news comes as the UAE continues to make significant strides in regulating cryptocurrencies.

Earlier this year, the Central Bank of the UAE approved a framework for issuing stablecoins. The move will allow for the creation of dirham-backed stablecoins, opening up new avenues for investment and financial products within the UAE.

In June 2024, Tether, a major issuer of stablecoins, announced its partnership with local firms Phoenix Group and Green Acorn Investments to introduce a stablecoin pegged to the UAE dirham. Another player, AED Stablecoin, received approval to issue a regulated dirham-pegged stablecoin.

Other major international stablecoins, such as USDC and EURC, have also secured recognition from the Dubai Financial Services Authority. Meanwhile, Ripple is currently examining the UAE’s stablecoin regulations. Its RLUSD stablecoin is already available in the region.