Central Bank of the United Arab Emirates Approves UAE Stablecoin
The AED Stablecoin, a digital currency pegged to the United Arab Emirates dirham, has received preliminary approval from the Central Bank of the United Arab Emirates (CBUAE) under its Payment Token Service Regulation framework.
This puts the company in a favorable position to become the first regulated issuer of a dirham-pegged stablecoin in the country.
The approval addresses concerns about potential restrictions on cryptocurrency payments, which arose after the CBUAE’s recent release of its licensing framework that only permits licensed dirham-pegged tokens for crypto payments.
If fully approved, AE Coin, the stablecoin associated with AED Stablecoin, could be used as a domestic trading pair for cryptocurrencies on exchanges and decentralized platforms, and also be accepted by merchants for goods and services.
The central bank’s licensing framework also prohibits algorithmic stablecoins and privacy tokens, in favor of fully backed assets.
