On 7 May 2025, two of the UAE’s regulated stablecoins — AE Coin (AED-pegged, issued by Al Maryah Community Bank) and USDU / Universal (USD-backed, issued by Universal Digital Intl Limited) — announced a strategic collaboration to build the first automated, regulated conversion framework between them. The banking infrastructure powering the bridge is provided by Al Maryah Community Bank (Mbank), making it the first on-chain AED–USD settlement rail operating under the UAE Central Bank’s regulatory perimeter.
What was announced
The initiative establishes an automated conversion mechanism enabling near-instant exchange between AED- and USD-denominated payment tokens within the UAE’s regulatory framework. According to the official announcement published by Gulf News and Khaleej Times, the structure is designed to support virtual asset market settlement, treasury operations, and liquidity management — while maintaining full compliance with domestic payment regulations.
Initial access to the conversion mechanism will be distributed through two regulated digital asset service providers: Aquanow and Changer.ae, both of which hold active UAE regulatory licences. The companies have also signalled plans to expand the framework into digital trade finance and multicurrency settlement for cross-border transactions.
“The future of digital finance in the UAE requires a secure, regulated bridge between local and global markets. As the first USD stablecoin registered under the CBUAE’s PTSR framework, USDU is positioned to deliver institutional-grade settlement. Automating conversion between USDU and AE Coin reduces friction and enables near-instant value exchange.” — Juha Viitala, Senior Executive Officer, Universal Digital INTL Limited
“By bridging AED and USD payment tokens within a compliant structure, we are laying the groundwork for scalable digital settlement and the modernisation of cross-border financial flows.” — Mohammed Wassim Khayata, CEO, Al Maryah Community Bank
The regulatory backdrop: five approved payment tokens
The announcement lands at a moment of unusual clarity in UAE stablecoin regulation. The Payment Token Services Regulation (PTSR), issued by the Central Bank of the UAE (CBUAE) in June 2024 and in full operational effect since late 2024, establishes the legal structure under which all payment tokens must operate. As of May 2025, the UAE has five CBUAE-approved payment tokens:
| Token | Peg | Issuer | Status |
|---|---|---|---|
| AE Coin | AED | Al Maryah Community Bank | Fully licensed |
| Zand AED | AED | Zand Bank | Fully licensed (Nov 2025) |
| DDSC | AED | DDSC UAE | Fully licensed |
| USDU | USD | Universal Digital Intl Limited | Licensed (FSRA/ADGM) + CBUAE registered |
| RAKBANK AED | AED | RAKBANK | In-principle approval |
The PTSR requires issuers to maintain 100% reserves in liquid, high-quality assets (at least 50% as cash held in UAE banks), with tokens redeemable at par within one business day. AE Coin received final CBUAE licensing in October/December 2024 and has since been integrated into government payments and Network International’s point-of-sale infrastructure. USDU is licensed by the Financial Services Regulatory Authority (FSRA) under Abu Dhabi Global Market (ADGM) and is registered with the CBUAE as a foreign payment token.
Why the market timing matters
The infrastructure announcement arrives against a backdrop of significant and accelerating demand. According to Chainalysis data cited by multiple regional outlets and the Blockchain Center Abu Dhabi:
- $56 billion in total UAE crypto volume between July 2024 and June 2025
- 51% of that volume in stablecoins — one of the highest concentrations in MENA
- +88.1% year-on-year growth in merchant crypto payments (small retail, under $1,000)
- +54.7% year-on-year growth in institutional transactions above $10M
The 51% stablecoin share of UAE crypto volume is driven in large part by the regulatory clarity introduced by the PTSR and the government’s proactive integration of payment tokens into public-sector infrastructure. Chainalysis attributes the merchant payments surge specifically to the rollout of licensed AED stablecoins and partnerships between regulated issuers like AE Coin and both government entities and retail platforms.
What comes next
AE Coin has already been approved for federal government fee payments and piloted by Dubai’s Department of Finance for government services. Network International has integrated it into its merchant payment terminals nationwide. The addition of a live, automated AED–USD conversion rail removes the last major friction point for institutions that need to move between local-currency and dollar-denominated settlement without leaving the regulated UAE perimeter.
The partners have indicated that trade finance and fintech platform integrations are in scope for future phases. As the UAE’s stablecoin ecosystem matures from a licensing story into an infrastructure story, the AE Coin–USDU bridge stands as its first fully regulated piece of interoperability plumbing.
Sources
- Gulf News — Official joint announcement, AE Coin & USDU (May 2025)
- Khaleej Times — AE Coin and USDU: regulated AED–USD digital conversion framework (May 2025)
- crypto.news — AE Coin and USDU launch regulated UAE stablecoin conversion rail
- Arabian Post — Digital dirham bridge targets UAE settlement flows
- Chainalysis / Khaleej Times — UAE stablecoin usage up 55% YoY, H1 2024
- Chainalysis 2025 MENA Crypto Adoption Report — UAE: merchant & institutional growth metrics
- Brave New Coin — RAKBANK in-principle PTSR approval (Jan 2026)
- Pinsent Masons — PTSR transition period end & CBUAE licensing status
- MENA Fintech Association — Full press release reprint
- PwC / CBUAE — Unlocking the future of payments and finance in MENA and the UAE (2025)