December 16, 2024
UAE’s Groundbreaking Approval of AE Coin: A New Era for Dirham-Backed Stablecoins
KEY HIGHLIGHTS:
- AE Coin is pegged 1:1 with the UAE Dirham, and it is the first stablecoin to receive full approval from the CBUAE.
- Fully backed by reserves in the UAE, AE Coin addresses cryptocurrency volatility and enhances trust in digital finance.
- The launch of AE Coin follows the CBUAE’s updated regulations on stablecoins.
UAE’S NEWEST STABLECOIN, AE COIN, RECEIVES CENTRAL BANK APPROVAL
In a significant development, AE Coin has received a full regulatory licence from the Central Bank of the UAE (“CBUAE“), marking a major milestone in the country’s digital finance ecosystem. In our earlier article, “The Approval of AED Stablecoin: A New Milestone for the UAE’s Digital Finance Ecosystem,” we reported that AE Coin had been granted in-principle approval.
With this full licensing, AE Coin officially becomes the first fully regulated, dirham-pegged stablecoin in the United Arab Emirates (“UAE“). This achievement positions AE Coin as a key player in the nation’s evolving cryptocurrency landscape and highlights the UAE’s progressive approach to fostering innovation in digital assets.
AE COIN: A STABLE AND REGULATED MEDIUM OF EXCHANGE
AE Coin stands out as a stable and reliable medium of exchange, fully backed by reserves held within the UAE. Each AE Coin maintains a 1:1 peg with the UAE’s Emirati Dirham (“AED“), mitigating the volatility commonly associated with cryptocurrencies.
AE Coin has received full approval under the CBUAE’s updated Payment Token Services Regulation, 2024. As mentioned in our previous article, “Securing Digital Finance: An Overview of the UAE’s Payment Token Services Regulation,” this framework establishes strict standards for AED-backed stablecoins. These include requirements for maintaining asset reserves, ensuring that capital requirements are met, and adhering to regulatory oversight [read here].
TIMELINE FOR APPROVAL
When we published our earlier article on 14 October 2024, the CBUAE had granted AE Coin in-principle approval. Two months later, on 11 December 2024, AE Coin received its full license to operate as an AED-backed stablecoin. This rapid approval process demonstrates that the CBUAE efficiently handles applications for stablecoins backed by AED.
This timeline shows that the regulatory approval process is quick and responsive for founders and businesses aiming to launch their AED-backed stablecoins. Now is an ideal time for those looking to enter this space to proceed.
HOW TLP ADVISORS CAN ASSIST?
At TLP Advisors, we are a forward-thinking consulting, strategy, and law firm specialising in solutions for the financial services, gaming, Web3, and emerging tech sectors. With deep expertise in these industries, we provide tailored support to address their unique challenges.
Recently, we helped clients navigate the CBUAE’s Payment Token Services Regulations and worked closely with relevant regulators to guide them on launching an AED-backed stablecoin. We regularly engage with key regulators and major blockchain firms in the UAE have retained us to support their growth and compliance.
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TLP Advisors has consistently been the firm of choice for L1 chains, DeFi protocols, gaming companies, fintech and payment companies, foundations, funds, and investors. We have built a reputation for excellence through frequent collaborations with regulators, funds, and technology incubators. Our deep understanding of the intricate regulatory landscapes and industry dynamics allows us to provide strategic guidance and innovative solutions that empower our clients to navigate complex challenges and seize emerging opportunities.
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