Zand becomes second UAE digital bank to issue regulated dirham-backed stablecoin

UAE Zand Bank, an AI-enabled digital bank, that has been the go-to bank for many UAE-regulated VASPs, has now stepped into the AED stablecoin arena with the launch of UAE Central Bank-regulated, public multi-blockchain AED-backed stablecoin.

Zand now becomes the second digital bank to launch a regulated stablecoin, after the first regulated AED stablecoin, AE Coin, issued by Mbank, almost a year prior.

As per the release, Zand AED aims to bring the AED Dirham into the global digital rails with the security of a regulated bank and the speed and openness of the blockchain.

Zand AED is supported by one-to-one AED reserves

The Zand AED is fully backed one-to-one by AED reserves held in segregated and regulated accounts, ensuring complete redemption value. It is supported by real-time transparency through independently audited smart contracts and reserve attestations.

It is available across multiple public blockchains, enabling fast, borderless settlement and seamless integration for developers, enterprises, and financial institutions. The stablecoin is issued by Zand Trust, a wholly owned subsidiary of Zand Bank PJSC, which is licensed and supervised by the UAE Central Bank, given that banks themselves cannot issue stablecoins directly.

“Launching an AED-backed stablecoin on public blockchains is not simply a milestone for Zand. It is a breakthrough for the UAE,” said Mohamed Alabbar, Chairman of Zand.“ This initiative carries our national currency into the digital future and reinforces the UAE’s position as a global leader in financial innovation.”

Michael Chan, CEO of Zand, added, “Zand AED is more than a stablecoin. It is the UAE’s bridge between traditional finance and decentralized finance. It unlocks the next generation of payments, tokenization, and digital asset innovation. All of it is built on trust, transparency, and regulatory clarity.”

This comes a week after the UAE piloted its Digital Dirham CBDC between governmental entities, as it prepares for the official launch at the end of 2025.

The question still remains why Tether has still not been able to launch its regulated AED stablecoin, which it was working on with the collaboration of Phoenix Group.

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