Abu Dhabi-based Universal Digital has launched USDU, the first US dollar-backed stablecoin registered by the Central Bank of the United Arab Emirates (CBUAE) as a foreign payment token under the Payment Token Services Regulation (PTSR), the company said.
According to a statement shared with Cointelegraph, the registration makes Universal the UAE’s first foreign payment token issuer and creates a clear and regulated US dollar-denominated settlement option for digital assets in the UAE.
Juha Viitala, senior executive at Universal, told Cointelegraph that the PTSR had allowed a transition period for payment token issuers to comply with the PTSR and that, among all USD stablecoins, USDU was the first to obtain such registration.
USDU and the UAE payment token regime
Universal is regulated by the Abu Dhabi Global Market Financial Services Regulatory Authority (FSRA) with permission to issue a fiat-referenced token and is now simultaneously registered with the CBUAE for payment token activities.
Viitala said that this dual oversight imposed a “higher level of discipline in reserve custody, governance, disclosures and operational controls” and that, for institutions, this difference was material because “the registry provides a clearer compliance path for certain regulated use cases.”
Regulated institutions such as banks, brokers and authorized venues in the UAE now have a dollar token registered with the central bank that they can connect to existing compliance, settlement and reporting workflows.
According to the PTSR, payments for digital assets and digital asset derivatives in the UAE can only be made in fiat currency or a registered foreign payment token.
While global stablecoins like Tether (USDT) and USDC (USDC) are widely used by UAE-based merchants through exchanges and over-the-counter (OTC) counters, they are not registered under the Central Bank’s payment token regime, meaning USDU is currently the only USD stablecoin that formally meets those requirements, Viitala explained.
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Reserve structure and banking partners.
USDU is issued as an ERC-20 token on Ethereum and is designed for institutional and professional use, with a conservative reserve structure and direct banking integration.
Reserves are fully backed 1:1 by US dollars held in secured domestic accounts at Emirates NBD and Mashreq, with Mbank acting as a strategic corporate banking partner and a global accounting firm providing monthly independent certifications.
Viitala It said banking partners provided custody and safeguarding of reserves, while the issuer remained responsible for meeting its obligations.
“User trust arises from the combination of regulated bank custody, recurring third-party certifications and regulatory oversight.” said.
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Institutional distribution via Aquanow
The firm is also working with AE Coin, an Emirati dirham-denominated stablecoin licensed by the Central Bank of the United Arab Emirates, to enable future conversion between USDU and AE Coin for domestic settlement, aligning US dollar and dirham payment tokens within the same regulatory perimeter.
Universal has appointed Aquanow, regulated by Dubai’s Virtual Asset Regulatory Authority (VARA), as its global distribution partner to expand institutional access to USDU and integrate it into regulated digital asset infrastructure, including in-out and settlement use cases.
While USDU can be used for domestic payments for digital assets and derivatives in the UAE, it is not permitted for general retail payments on the continent, where dirham-denominated instruments remain the standard.
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