TL;DR
- The CBUAE approved USDU, the country’s first USD stablecoin, designed for regulated settlements of digital assets and derivatives.
- USDU is backed 1:1 by reserves and is issued as an ERC-20 token on Ethereum. The reserves are audited monthly.
- Universal designated Aquanow for international distribution and will collaborate with AECoin for future conversions and local settlements.
The Central Bank of the United Arab Emirates (CBUAE) approved the country’s first USD-backed stablecoin, named USDU.
The token was issued by Universal Digital Intl Limited and becomes the first Foreign Payment Token registered under the Payment Token Services Regulation (PTSR). USDU is authorized as a regulated settlement instrument for digital-asset and derivative transactions in the UAE.
Universal (USDU)
The stablecoin is backed 1:1 by U.S. dollar reserves held in secured accounts at local banks, including Emirates NBD, Mashreq Bank, and Mbank. The reserves are audited monthly by an international accounting firm. The stablecoin is designed to prioritize liquidity, transparency, and reliability in settlements.
USDU is issued as an ERC-20 token on Ethereum, facilitating integration with existing and regulated blockchain infrastructure. For international distribution, Universal designated Aquanow, regulated by Dubai’s Virtual Assets Regulatory Authority (VARA). This partnership allows institutional counterparties outside the UAE to access the token within approved compliance frameworks.
Under PTSR, payments for digital assets and derivatives in the UAE must be made in fiat or through a Registered Foreign Payment Token. With USDU, banks, brokers, and licensed trading platforms have a fully compliant tool. This positions the stablecoin as the only USD option registered for institutional transactions within the country.
Stablecoins for Local and International Settlements
Universal’s strategy includes collaboration with AECoin, the first licensed AED stablecoin, enabling future USDU-AECoin conversions for local settlements. The token can also connect to international digital-asset markets where local regulations allow, providing regulated value transfers outside the country.
The project’s strategic partners are Emirates NBD, Mashreq, and Mbank. The banks provide institutional support and validate the financial infrastructure behind USDU. Universal executives and bank representatives noted that the token will be used for institutional transactions and settlements under centralized supervision.
USDU becomes the first USD stablecoin to meet regulated settlement requirements in the UAE. Its model provides a secure channel for integrating crypto markets with traditional banking.
