UAE central bank clears dirham-backed DDSC for retail listing

The Central Bank of the UAE issued a no-objection certificate for DDSC, a stablecoin pegged 1:1 to the UAE dirham. The certificate allows Dubai Virtual Assets Regulatory Authority (VARA) licensed exchanges to list and trade the token and offer it to consumers across the UAE.

DDSC was developed by International Holding Company (IHC) together with First Abu Dhabi Bank and Sirius International Holding. The token runs on the ADI blockchain and is backed by dirham reserves. The central bank’s certificate states DDSC met federal requirements for asset backing, compliance and operational controls under the Payment Token Services Regulation.

The stablecoin completed an institutional trial that processed more than $40 million (150 million dirhams) in transactions to test stability and capacity. Following the federal clearance, approved VARA platforms are expected to list DDSC and expand retail access, payments and merchant acceptance across the country.

Under federal rules, the central bank retains sole authority over payment tokens to protect the national currency and limit financial risk. VARA issues licenses to Dubai-based exchanges, but those platforms cannot list or convert local-currency stablecoins without federal clearance. The Capital Market Authority continues to oversee investment-related virtual asset service providers.

Issuing a dirham-backed stablecoin enables payments on a blockchain in local currency. Reported use cases include peer-to-peer transfers, merchant payouts and supplier invoice settlement in dirhams, which may reduce reliance on traditional banking corridors and the delays and fees those can involve.

IHC CEO Syed Basar Shueb commented, “This approval represents another important milestone in the development of the UAE’s regulated digital financial ecosystem.”

The certificate does not change ongoing federal regulation of payment tokens. It allows VARA-licensed exchanges that have federal clearance to list a locally minted dirham stablecoin for retail users under the existing multi-agency framework.