UAE Announces Digital Dirham Launch in 2025

The Central Bank of the United Arab Emirates (CBUAE) has announced its plans to launch the Digital Dirham, a central bank digital currency (CBDC), in the fourth quarter of 2025. This initiative is part of the Financial Infrastructure Transformation (FIT) Programme, which aims to bolster the UAE’s position as a pioneer in financial market infrastructure and a destination for excellence in financial products innovation and digitalization.

The Digital Dirham, built on blockchain technology, is designed to enhance financial stability, improve inclusion, increase resilience, and help combat financial crime. The new digital currency will be issued as a digital version of the UAE’s national currency, characterized by high levels of security and efficiency. This will contribute to reduced costs of payments through its reliance on blockchain technology, which ensures effective risk management, data protection, privacy, and atomic transaction completion.

The CBUAE has developed an integrated and secure platform for the issuance, circulation, and use of the Digital Dirham, including a Digital Dirham wallet. The wallet is designed for ease of use and management by both individuals and businesses, enabling a number of financial transactions, including retail, wholesale, and cross-border payments, money transfers and withdrawals, top-ups, and redemption of the Digital Dirham when needed. This ensures a seamless and convenient user experience, in line with industry best standards and practices.

The platform is also characterized by its ability to easily incorporate innovative financial solutions tailored to emerging use cases driven by the rapid growth of the digital economy in the UAE. This contributes to ensuring a flexible and advanced financial system, further solidifying the UAE’s competitive edge as a leading financial hub and global digital payments platform.

The Digital Dirham offers several key advantages and characteristics that drive development and innovation, including tokenization and smart contracts. Tokenization facilitates financial inclusion and efficiency, and expands access to liquidity through digital asset fractionalization. Smart contracts are used to program the execution of complex transactions automatically, settling them instantly, in addition to multi-stage and multi-party transactions that involve conditions or obligations.

The CBUAE has also unveiled the new symbol for the UAE’s national currency, the “Dirham,” in both its physical and digital forms. The new symbol incorporates two horizontal lines that embody the stability of the UAE Dirham and are inspired by the UAE flag, enhancing financial and monetary stability. The Digital Dirham symbol features a circle surrounding the physical currency symbol, using the colors of the UAE flag to reflect pride and national identity.

Khaled Mohamed Balama, Governor of the CBUAE, expressed pride in unveiling the new symbol for the UAE’s national currency and the design of the Digital Dirham wallet. He stated that the Digital Dirham, as a blockchain-based platform with cutting-edge capabilities, is expected to substantially enhance financial stability, inclusion, resilience, and combatting financial crime. It will further enable the development of innovative digital products, services, and new business models, while reducing costs and increasing access to international markets.

This move represents a significant step forward in the UAE’s broader digital transformation strategy. The Digital Dirham is anticipated to support smart contracts and tokenization, features that enable automated, secure, and complex transactions while expanding access to digital financial tools. The currency will be available through regulated banks, fintech companies, exchange houses, and licensed financial firms, making it accessible to a wide range of users.

Balama described the updated branding as a signal of progress and a key part of the country’s digital agenda. He emphasized that the Digital Dirham will improve financial resilience, inclusion, and regulatory oversight while enabling the development of new products and services. This announcement follows the CBUAE’s recent membership in the Global Foreign Exchange Committee, further solidifying its commitment to promoting transparency and integrity in global financial markets.