UAE Stablecoin Regulations Fuel Safer Exploration of Digital Assets
The UAE’s push toward clear and regulated frameworks for stablecoins is gaining momentum, encouraging more residents and newcomers to explore digital assets with greater confidence and safety. Industry experts say that recent global and regional developments in stablecoin regulation are transforming how users perceive and adopt cryptocurrencies for payments and decentralised finance (DeFi).
This comes in the wake of the US Genius Act, signed into law by President Donald Trump, which establishes a regulatory regime for USD-pegged stablecoins. Experts believe this global shift will not only boost trust in digital assets but also encourage more adoption in the UAE, where local fiat-backed stablecoins are becoming a priority.
According to CoinGecko, the stablecoin market is currently valued at over $260 billion (Dh954 billion) and is projected to reach $2 trillion (Dh7.3 trillion) by 2028 with regulatory frameworks now in place.
In the UAE, a similar regulatory trajectory is underway. Meera Judge, Director of Regulatory Licensing and Policy at Binance, emphasized that stablecoin rules play a vital role in creating a safer and more transparent financial ecosystem. “When people feel safe, they’re more likely to participate,” she said. “Clear rules create room for innovation — and that’s where real adoption starts.”
Judge highlighted that AE Coin, the UAE’s AED-backed stablecoin, was officially licensed by the Central Bank of the UAE (CBUAE) in December 2024, under its Digital Payment Token Services Framework. The coin offers instant, secure, stable, and cost-effective payments—making it a key milestone in the UAE’s vision for a regulated crypto ecosystem.
“The UAE’s AED-backed stablecoin isn’t just another digital token. It’s a signal of the country’s commitment to financial innovation and regional independence,” Judge added. “It also positions the UAE as a competitive player in the global crypto landscape.”
Stablecoins, by design, maintain a constant value and are often pegged to fiat currencies. While USD-backed stablecoins have long dominated the market, the UAE’s focus on local fiat alternatives shows a regional ambition to promote financial inclusion and economic diversity.
Gracy Chen, CEO of Bitget, echoed these sentiments, noting that the UAE’s stablecoin regulations effective June 2025 focus on local currency stability and centralised oversight by the CBUAE, unlike the US’s dual federal-state model for USD stablecoins.
“Non-USD stablecoins like AED-backed tokens are essential for regional trade,” Chen explained. “They reduce reliance on the US dollar, cater to local markets, and drive global crypto diversity. Supporting them can attract more MENA-based users, while USD compliance ensures broader international access.”
Chen also pointed out that stablecoins backed by major banks — including JPMorgan, Bank of America, Citigroup, and Wells Fargo in the US, and FAB, MBank, and Zand Bank in the UAE — could legitimize and boost crypto adoption. However, she cautioned that higher regulatory compliance could lead to market concentration, potentially stifling smaller players and innovation.
Still, the consensus among industry experts is optimistic: regulated stablecoins are the bridge to safer, faster, and more accessible digital finance.
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