The UAE's first regulated stablecoin, AE Coin, has been approved in principle by the central bank

The Central Bank of the United Arab Emirates (CBUAE) has approved in principle the stablecoin issuance license of AED Stablecoin under its regulatory framework for payment token services. This makes AED Stablecoin the first institution in the UAE to be approved to issue a stablecoin pegged to the dirham. If finally approved, the AE Coin issued by AED Stablecoin will be available as a local trading pair for cryptocurrency transactions and allow merchants to accept it as payment for goods and services.

The CBUAE's licensing framework requires stablecoin issuers to hold their assets entirely in cash in a separate custody account at a UAE bank, or to hold at least 50% of their reserve assets in cash, with the remainder being invested in UAE government bonds and CBUAE currency notes.