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UAE Central Bank Digital Currency (CBDC) Announcement
The United Arab Emirates (UAE) is gearing up to launch a central bank digital currency (CBDC) for both retail and wholesale use, as revealed in an announcement by the Central Bank of UAE (CBUAE).
Partnerships for CBDC Implementation
The national bank has initiated its digital dirham implementation strategy through a partnership with R3 and G42 Cloud. These companies will provide the necessary infrastructure and technology for the digital currency.
Benefits of UAE CBDC
The CBDC is expected to address challenges in domestic and cross-border payments, promote financial inclusion, and drive the transition towards a cashless society, according to the CBUAE.
CBDC Implementation Phases
The UAE CBDC implementation is part of the CBUAE’s Financial Infrastructure Transformation (FIT) Programme, consisting of nine initiatives. The first phase includes the launch of mBridge for real-time cross-border transactions and international trade settlements.
Subsequent phases will involve proof of concept work on CBDC bridges with India and exploring domestic CBDC use cases for retail and wholesale payments.
Future of Digital Dirham
CBUAE envisions the digital dirham as a step towards a “tokenized” future, where blockchain-based tokens are widely used for financial and non-financial purposes. Governor H.E. Khaled Mohamed Balama sees CBDC as a catalyst for digitalization and financial inclusion in the UAE.
Joint Ventures for Digital Asset Infrastructure
Bridge Tower Capital and Deus X recently launched a $250 million joint venture, BridgeTower Middle East, to develop digital asset infrastructure in the UAE and promote institutional crypto adoption in the region.
Ian is a cryptocurrency enthusiast blending humor with professionalism. With an engineering background and a storyteller's heart, he simplifies the blockchain world with sharp analysis and a touch of wit. At Cryptowire, he brings his unique perspective to make digital financial innovation accessible to all.