The war crisis with Iran and growing geopolitical tensions in the Middle East have further accelerated the United Arab Emirates’ plans to develop stable digital currencies tied to the dirham, known as stablecoins.
Financial analysts estimate that the authorities in Abu Dhabi and Dubai want to reduce dependence on traditional international payment systems and ensure greater resilience of the financial sector in the event of new regional conflicts.
UAE accelerates development of regulated stablecoins
The UAE Central Bank has approved several digital currency projects linked to the Emirati dirham in recent months, including stablecoin DDSC, which is backed by International Holding Company, Sirius International Holding and First Abu Dhabi Bank, according to “agbi”. The new system is developed on the ADI Chain blockchain network and is designed as a secure platform for digital payments, trade and international money transfers.
Additionally, RAKBANK Bank has received preliminary approval to issue its own stablecoin, while Network International has already enabled the use of digital dirhams on trading platforms across the UAE. Experts believe that the Emirates wants to become a leading regional center for digital finance and blockchain technology.
War with Iran increased financial and security risks
The plans to accelerate the digitization of the financial system come as the UAE faces the fallout from the conflict with Iran, including missile and drone attacks on the country’s territory in 2026. According to available data, Iranian forces carried out hundreds of attacks on targets in the Emirates, while the authorities in Abu Dhabi and Dubai had to further strengthen security and cyber measures.
Analysts state that the circumstances of the war have shown how sensitive traditional banking systems and international transfers are to political crises, sanctions and possible disruptions in regional trade. According to experts, stablecoins could enable faster and safer financial transactions even during serious geopolitical instability.
Emirates wants to lead the way in digital finance
The UAE authorities have been investing large resources in the development of the fintech sector, blockchain infrastructure and the digital economy for years. The new stablecoins should enable more efficient international payments, the modernization of banking services and the development of the so-called “programmable economy”, in which part of the financial processes would be automated through smart contracts and artificial intelligence.
At the same time, the Emirates is trying to attract international investors and technology companies that are looking for a stable and regulated market to develop digital financial products. This is precisely why the authorities insist on a strictly regulated stablecoin model, in contrast to certain unregulated crypto projects that previously caused major financial upheavals on the global market.
