Experts are optimistic the recent signing by US President Donald Trump of the Genius Act - creating a regulatory regime for dollar-pegged cryptocurrencies known as stablecoins - will not only give users the confidence to explore digital assets safely but will also draw more users in the UAE, especially newcomers, to crypto by making stablecoins safer and more mainstream for payments and decentralised finance (DeFi).

The stablecoin market, which crypto data provider CoinGecko said is valued at more than $260 billion (Dh954 billion), could grow to $2 trillion (Dh7.3 trillion) by 2028 under the new law. It's a milestone that could pave the way for digital assets to become an everyday way to make payments and move money, experts told KT LUXE. The regulatory framework is also seen as a big leap from the time of“speculative chaos” when stablecoin first came into being back in 2009.

The UAE has also moved forward with regulations of AED stablecoins, noted Meera Judge, director, regulatory licensing and policy at Binance.“When people feel safe, they're more likely to participate. Clear rules create room for innovation - and that's where we see real adoption start to take shape,” she said.

Regulations serve as important guardrails, with enhanced transparency serving as the key factor in consumer protection. They build confidence and encourage people who might have been hesitant to explore crypto as a real option for diversifying their finances.

In December last year, AE Coin secured the final Central Bank of the UAE (CBUAE) licence it needed to launch. It was developed under the CBUAE's digital payment token services framework for instant, secure, stable, innovative, low-cost, and efficient payment experience.

“The UAE's AED-backed stablecoin is a really exciting milestone. It shows how seriously the UAE is taking decentralised finance and its future role in global financial innovation. This isn't just about creating another stablecoin, it's a clear signal of the UAE's commitment to building a regulated, forward-thinking crypto ecosystem that can compete on the world stage,” Judge said.

Stablecoins are designed to maintain a constant value. For the UAE, its focus on a local fiat-backed stablecoin also reflects a regional ambition to diversify beyond the dominance of the USD stablecoins, which have long been the industry's gateway. This is very positive for the country as it is not only about necessity but also about creating opportunity.

Judge explained:“Local fiat stablecoins (like AE Coin) reinforce the seriousness with which countries are approaching crypto regulation and innovation. They help tailor financial tools to regional needs, supporting local businesses and consumers while promoting financial inclusion.

“Moreover, having a wider range of fiat-backed stablecoins contributes to a more diverse and resilient ecosystem, a key step toward making crypto relevant and accessible to people everywhere, not just in dollar-dominated markets,” Judge added.

Gracy Chen, CEO of Bitget, shared the same analysis, and optimism that stablecoins will draw more users, especially newcomers.

She told KT LUXE:“The UAE's AED stablecoin regulations, effective June 2025, focus on local currency stability and centralised oversight by the Central Bank, while the US Genius Act targets USD-pegged stablecoins with a dual federal-state framework.

“Both aim to enhance trust and adoption, but the UAE emphasises regional financial sovereignty, unlike the USD-centric US approach. Non-USD stablecoins like AED-backed tokens are crucial for regional trade, reducing USD reliance, and catering to local markets, driving global crypto diversity. Supporting AED stablecoins can attract MENA users, while USD stablecoin compliance ensures broader market access,” Chen explained.

She added bank-backed USD and AED stablecoins promise faster, cheaper transactions, boosting liquidity, but may challenge existing tokens like USDT (Tether), increasing compliance costs for exchanges.“This could lead to market concentration, potentially limiting innovation, while subjecting exchanges to stricter regulatory scrutiny.”

Chen also pointed out the entry of major US banks (JPMorgan, Bank of America, Citigroup, Wells Fargo) and UAE banks (FAB, MBank, Zand Bank) into the stablecoin market will enhance crypto legitimacy, driving adoption and trading volumes on exchanges.

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