Universal Digital Intl Limited on Thursday launched USDU, the UAE’s first central bank-approved stablecoin that puts it in direct competition with Circle’s (NYSE:CRCL) USDC (CRYPTO: USDC).
How USDU Works
This make Universal Digital the first company registered by the Central Bank of the UAE to issue a Foreign Payment Token, The Block reported.
USDU is backed by dollars held in reserve at major UAE banks, such as Emirates NBD, Mbank, and Mashreq.
USDC issuer Circle has a license from Abu Dhabi Global Market in December to operate as a money services provider and plans to expand payment services to drive USDC adoption across the UAE and Middle East.
Circle’s license differs from Universal’s central bank registration insofar as USDC can operate in the UAE but does not have the same official status as USDU for settling digital-asset transactions.
That gives Universal a regulatory advantage.
Institutions needing full compliance with UAE settlement rules must use USDU or convert to fiat.
This regulatory push is part of the UAE’s strategy to become a major crypto hub.
Universal partnered with Aquanow, regulated under Dubai’s Virtual Assets Regulatory Authority, to integrate USDU into the broader crypto ecosystem through Aquanow’s network of regulated providers.
What This Means For Investors
For institutions doing business in the UAE, USDU offers a compliant settlement option backed by local banks and approved by the central bank.
The news comes in the light of Tether launching a new U.S.-compliant stablecoin and Fidelity launching FIDD, indicating continued strong institutional interest in stablecoin adoption.
Image: Shutterstock
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