The UAE is taking another major step toward regulated cryptocurrency adoption. The latest reports reveal that Abu Dhabi’s Universal Digital has officially launched USDU, the UAE’s first USD-backed stablecoin. This move signals a growing clarity and maturity in the country’s digital asset industry, with the central government approving the dollar-denominated settlement option.
The USDU token is significantly more than just a token. It marks a structural shift in how cryptocurrencies can be settled offshore. The token is issued on Ethereum and backed 1:1 by the US dollar reserves held with the UAE banks.
USDU Becomes the UAE’s First USD Stablecoin
Universal Digital has reportedly rolled out USDU, the UAE’s first US dollar-pegged stablecoin approved as a Foreign Payment token under the Central Bank’s Payment Token Services Regulation. This stablecoin launch has marked a major milestone for the country’s crypto industry as it introduces a regulated way in the UAE for fast and effective settlements.
The Central Bank of the United Arab Emirates (CBUAE) has reportedly approved the launch of Universal Digital’s USDU token. While the USDU stablecoin has become the inaugural dollar-backed token, Universal Digital is now the first company to complete this approval process. Universal’s Juha Viitala posited,
“Being the first Foreign Payment Token registered by the UAE Central Bank – and supported by leading UAE banks – gives institutions the clarity and confidence they have been waiting for. It lays the groundwork for a more transparent and efficient digital-asset market in the UAE and beyond.”
As per the official statement, Universal Digital will issue and manage the token under the supervision of Abu Dhabi’s Global Market’s Financial Services Regulatory Authority. This makes the company the first foreign payment token issuer officially registered by the UAE’s central bank. The report also stated that MBank will support the project as a major banking partner.
Why This USDU Approval Is a Big Deal?
Significantly, the UAE’s stablecoin approval reflects a growing global push for regulated stablecoins. As the token is supported by the central bank, it also highlights the fading gap between crypto and traditional finance (TradFi).
The PTSR framework is designed to bring consistency to how digital assets are used for payments and settlements. Over time, this could shape liquidity in the region and make cross-border transactions smoother as banks and licensed platforms adopt compliant tokens.
By registering USDU as a Foreign Payment Token, the UAE has created a clear and official path for using a USD-backed token within the financial system. For institutions operating in the country, this brings more certainty when settling crypto trades, managing accounts, and meeting reporting requirements. The stablecoin is backed by onshore reserves and independently verified, while oversight from both the Central Bank and ADGM’s regulator helps raise standards around governance, transparency, and operational controls.
It is worth noting that the development comes as part of the UAE’s broader efforts to establish a crypto regulatory framework. As CryptoMoonPress reported yesterday, the UAE’s ADGM unveiled plans to regulate the country’s crypto mining activities.
Thus, with the latest development, the country is becoming a leading player in the global crypto space. The country is building clear rules that allow digital assets to grow alongside the traditional financial system.
