Stablecoins is entering a more mature phase in the United Arab Emirates (UAE), driven by regulatory clarity, development in digital asset infrastructure, and regional payment needs.
A new paper by industry trade group MENA Fintech Association and blockchain startup Fireblocks looks at the state of this market, outlining emerging trends and key opportunities across cross-border payments, remittances, business-to-business (B2B) settlement and treasury operations, and merchant payments.
Cross-border payments and remittances
Cross-border payments and remittances are a prominent application of stablecoins in the UAE, and currently the most commercially mature use case. In this application, stablecoins solve critical pain points inherent in traditional international transfers, including slow settlement times, high fees from multiple intermediaries, and lack of transparency.
The use of stablecoins in cross-border payments has increased over the past years. The Bank for International Settlements (BIS) estimates that cryptocurrencies facilitated roughly US$600 billion in cross-border payments in Q2 2024 alone, with stablecoins USDT and USDC accounting for about two thirds of that volume. This marks a stark increase from their negligible share in 2020 and prior years.
The UAE is the second-largest outbound remittance hub in the world after the US. In 2024, outward remittances reached AED 183 billion (US$50 billion), with funds flowing primarily to India, Pakistan, the Philippines, Egypt, and Bangladesh, according to Statista.
B2B settlement and payments
B2B settlement is another prevalent stablecoin use case that’s set to scale early in the UAE. Businesses need faster movement of funds across markets, better treasury visibility, and the ability to operate across time zones without being limited by banking cut-off times. Stablecoins can support these movement of funds where fiat rails are too slow, too expensive, unavailable outside banking hours.
Industry participants are already reported improvements from stablecoin adoption. Worldpay, a global payment processing company, claims that integrating blockchain technology and stablecoin settlements into its payment infrastructure have allowed it to achieve 24/7/365 settlement with merchants in T+0, enhancing operational and merchant capital efficiency, and enabling settlement times that are up to 50% faster than traditional payment rails.
In 2025, B2B stablecoin payment volume reached US$226 billion, representing just about 0.01% of global B2B payment volumes, according to McKinsey. However, usage is growing quickly, with B2B stablecoin payment volumes rising 733% year-over-year (YoY) in 2025.
Merchants payments are another key stablecoin use case in the UAE. However, adoption requires a change in consumer and merchant behavior as cards, wallets, loyalty points, and existing acquiring networks are deeply ingrained in local payment habits. Stablecoin merchant payments may become more relevant once local currency stablecoins, programmable settlement, and interoperable payment infrastructure mature, the report predicts.
A conducive regulatory landscape
Several drivers are driving the growth of stablecoins in the UAE, beginning with the country’s clear and supportive regulatory landscape.
The Central Bank of the UAE (CBUAE) Payment Token Services Regulation gives federal structure to stablecoin and payment token activity, defining payment token services across issuance, conversion, and custody and transfer. It also sets expectations around licensing, registration, reserve assets, redemption, custody, and related safeguards.
To date, at least four AED-pegged stablecoins have received approval from the CBUAE: AE Coin, DDSC, Zand AED, and Rakbank’s AED stablecoin. Other stablecoins have also been approved, including USD-backed stablecoins USDU, issued by Universal Digital, and RLUSD, issued by Ripple.
The Payment Token Services Regulation sits alongside the UAE’s wider digital asset regulatory landscape. At the federal level, the Securities and Commodities Authority regulates security and commodity tokens.
At the local level, the Virtual Assets Regulatory Authority (VARA) licenses virtual asset service providers in Dubai, including exchanges, brokers, and custodians. Finally, within the financial free-zones of the Dubai International Financial Centre (DIFC) and the Abu Dhabi Global Market (ADGM), financial regulators provide common law jurisdictions familiar to global financial institutions, enabling regulated financial and digital asset activity from the UAE.
Market outlook
Stablecoin transaction volumes have surged over the past years. At the start of 2025, stablecoin issuance volumes stood up approximately US$200 billion, according to Citi. By 2030, the bank forecasts the market reaching US$1.9 trillion in its base case, and up to US$4 trillion in its bull case, supported by new favorable regulations, increased institutional acceptance, and soaring transaction volumes across real-world applications.
In the Middle East, the UAE stands as one of the largest markets for digital assets. The country ranks third in digital asset transaction volume in the Middle East and North Africa (MENA), with US$34 billion recorded in the year ending June 2024 and a 30% adoption rate. It follows Turkey with US$170 billion and a 52% adoption rate, and Saudi Arabia with US$47 billion and a 20% adoption rate.
Featured image: Edited by Fintech News Middle East, based on image by farknot via Magnific
