Abu Dhabi’s ADQ, FAB, and IHC Team Up to Launch Dirham-Backed Stablecoin

Abu Dhabi, the capital of the United Arab Emirates (UAE), is making a significant stride into cryptocurrency space. On April 28, 2025, the Abu Dhabi sovereign wealth fund ADQ, alongside First Abu Dhabi Bank (FAB) and International Holding Company (IHC), announced plans to launch a stablecoin pegged to the UAE dirham. This initiative, set to be fully regulated by the UAE Central Bank (CBUAE), aims at easing payment solutions both loccally and globally.

The dirham-backed stablecoin will be issued by FAB, the UAE’s largest bank by assets, pending regulatory approval. Designed to maintain a stable value tied to the national currency, this digital token aims to facilitate seamless transactions for consumers, businesses, and institutions across a variety of use cases. According to a joint statement from the three entities, the stablecoin will operate on the ADI blockchain, a domestically developed platform by the ADI Foundation, enhancing security and scalability for blockchain-based payments.

UAE’s Fintech Ambitions

This announcement follows the UAE’s growing interest in digital assets. In December 2024, UAE introduced its first dirham-backed regulated stablecoin, AE coin. It has been granted final approval by local authorities and is scheduled to be launched in 2025. The new stablecoin builds on this foundation, aiming to support not only everyday payments but also advanced applications such as machine-to-machine transactions and AI-driven processes.

ADQ, a sovereign wealth fund managing approximately $225 billion in assets as of 20224, is a driving force behind this initiative. Mohamed Hassan Alsuwaidi, Managing Director and Group CEO of ADQ, emphasized the project’s role in bolstering the UAE’s digital infrastructure. “The launch of stablecoin marks a pivotal step in our commitment to strengthening the UAE’s digital infrastructure ecosystem,” he said,“as we move forward towards an increasingly digital and connected economy, stablecoin will provide a solution that is secure, efficient and scalable, while creating new opportunities for growth and value creation.”

FAB is the largest bank in the UAE, formed in 2017 through a merger between First Gulf Bank and National Bank of Abu Dhabi. With its extensive financial expertise, FAB will oversee the issuance process. Group CEO Hana Al Rostamani described the stablecoin as a “ground-breaking development” that could transform blockchain-based payments across industries. Meanwhile, IHC, a conglomerate with a strong foothold in fintech, brings its blockchain knowledge to the table. CEO Syed Basar Shueb noted, “we are proud to have played a key role in its creation. By bringing IHC’s expertise in blockchain and fintech, we look forward to working with our partners to explore its vast potential and drive innovation in the UAE.”

The UAE has been positioning itself as a global fintech hub, and this stablecoin aligns with that ambition. Unlike volatile cryptocurrencies such as Bitcoin or Ethereum, stablecoins offer price stability by being pegged to fiat currencies, making them suitable for practical applications. As of April 29, 2025, the dirham remains stable at approximately 3.67 AED to 1 USD, providing a reliable anchor for the digital token.

This move comes amid a regional push toward digital transformation. Just last month, Abu Dhabi-based investment group MGX committed $2 billion to Binance, one of the largest deals in crypto history. The dirham-backed stablecoin could further solidify the UAE’s role in bridging traditional finance and blockchain technology. “This new stablecoin represents a transformative step forward and will revolutionise the way both consumers and businesses engage with trusted blockchain payments in the UAE,” said Rostamani.