UAE Debuts First Central Bank-Approved Stablecoin USDU

Core Insights - The Central Bank of the United Arab Emirates has approved USDU, the first USD-backed stablecoin in the country, under the Payment Token Services Regulation [1][2] - USDU is now part of the regulated payment system in the UAE, ensuring it operates within the banking framework [2] - Universal Digital has become the first Foreign Payment Token Issuer registered by the UAE central bank, managing and issuing USDU [3][4] Regulatory Structure and Issuance Model - USDU is issued and managed by Universal Digital, operating under the Financial Services Regulatory Authority at Abu Dhabi Global Market [3] - The stablecoin is backed one-to-one by US dollars, with reserves held in safeguarded on-shore accounts at Emirates NBD and Mashreq [4] - The regulatory framework provides legal clarity on issuance, custody, and reserve handling for USDU [4] Institutional Interest and Market Maturation - There is growing institutional interest in regulated digital-value instruments, with USDU's introduction seen as a timely step for market maturation [5] Parallel Developments in Crypto Use - Dubai Insurance has launched a crypto insurance wallet, allowing policyholders to pay premiums and receive claims in digital assets, including stablecoins [6] - The wallet operates on infrastructure from Zodia Custody, focusing on institutional security and regulatory alignment [7]