Latest news with #FinancialMarketInfrastructure
Arabian Post
11-07-2025
- Business
- Arabian Post
BoE charts new wholesale terrain for stablecoins and tokenised assets
The Bank of England is evaluating the role of stablecoins in wholesale payments and tokenised asset infrastructure via its UK Digital Securities Sandbox, at a pivotal juncture for financial market innovation. Sasha Mills, Executive Director of Financial Market Infrastructure, outlined this approach during her keynote at City Week in London on 2 July. The central bank is focusing on blending stability, regulatory clarity, and interoperability as it reshapes post-trade and settlement systems. Mills emphasised that the digitalisation of wholesale financial markets—driven by tokenisation, distributed ledger technology, smart contracts and programmable ledgers—has the potential to enhance market depth, reduce friction, and mobilise capital more efficiently. Yet she stressed that any emerging system must preserve the bedrock of financial stability: confidence in finality of settlement and risk parity across new and legacy platforms. The Digital Securities Sandbox has emerged as a cornerstone of the Bank's strategy. Since its inception, the sandbox has attracted both incumbents and new market entrants. A notable early application has been the UK Government's Digital Gilt pilot—nicknamed DIGIT—where debt issuance occurs on a distributed ledger. Mills noted it has catalysed broader interest in using tokenisation to simplify asset mobility, enable intraday repo operations and improve collateral utilisation. ADVERTISEMENT Crucially, the Bank is exploring the integration of stablecoins within this sandbox framework. While central bank money remains the preferred settlement asset, Mills described the Bank's position as 'open‑minded' to stablecoins' potential utility in wholesale markets. The Bank plans to provide further clarity on stablecoin roles and standards later this year. In its consultation approach to systemic stablecoins—launched with a discussion document in November 2023—the central bank is considering reforms such as permitting a percentage of reserves to be held in high-quality liquid assets, rather than unremunerated central bank balances. It is also contemplating transitional holding limits: for individuals, between £10,000 and £20,000; for businesses, up to £10 million. These measures aim to curb stability risks from sudden large outflows. Beyond stablecoins, tokenised deposits are highlighted as a promising vehicle to merge regulatory safeguards of traditional deposits with the efficiency of real-time, on‑chain settlement. Mills confirmed the Bank is working to integrate tokenised deposits across DSS initiatives and its broader National Payments Vision. Complementing these developments, the Bank continues to elevate its core infrastructure. Its Real‑Time Gross Settlement system is undergoing major upgrades under the RT2 programme. Upcoming enhancements include broader access, extended operating hours, and a synchronisation interface. This interface is designed to facilitate conditional settlement—in which transfers within the RTGS can be synchronised with transactions on external DLT systems. The Bank has joined the BIS Innovation Hub's DLT Innovation Challenge to test whether wholesale central bank money can be transacted and settled on external programmable ledgers. Mills described this as an experiment into how wholesale central bank monies, stablecoins, and tokenised deposits can co-exist safely. The BoE maintains that a mixed infrastructure ecosystem—where traditional and emerging systems operate side by side—is the foreseeable outcome. Ensuring interoperability across public and private, permissioned and permissionless ledgers is essential to prevent liquidity fragmentation and support seamless transfer of capital. Public blockchains may offer connectivity solutions, provided they meet security and regulatory standards. Mills cautioned that while technological adoption is important, regulators must integrate hard-earned lessons on confidence and stability. 'Money requires confidence to support economic activity and growth in good times and bad,' she said, warning that failures in settlement finality could erode trust and trigger cascading market events. With its 'secondary innovation objective', the Bank is actively reviewing existing regulations that pose barriers to digital finance, engaging continuously with industry participants. The DSS, tokenised deposits, upgraded RTGS, stablecoin framework, and experimental alignment with DLT signal a coordinated strategy to modernise UK wholesale finance.
Emirates 24/7
27-03-2025
- Business
- Emirates 24/7
CBUAE Unveils New Symbol for the UAE Dirham and Advances Digital Currency Initiative
The Central Bank of the UAE (CBUAE) has unveiled a new symbol for the UAE's national currency, the Dirham, in a move that reflects the vision of the country's wise leadership and the directives of His Highness Sheikh Mansour bin Zayed Al Nahyan, Vice President, Deputy Prime Minister, Chairman of the Presidential Court, and Chairman of the CBUAE Board. This initiative reinforces the UAE's position as a leading global financial hub. In parallel, the CBUAE announced key developments in the issuance and circulation of the Digital Dirham, a central component of the Financial Infrastructure Transformation (FIT) Programme launched in 2023. The Digital Dirham aims to position the UAE at the forefront of Financial Market Infrastructure (FMI) innovation and excellence in digital financial products. Backed by Federal Decree-Law No. (54) of 2023, which amends key provisions of Federal Decree-Law No. (14) of 2018 concerning the Central Bank and the regulation of financial institutions and activities, the Digital Dirham will be legally recognized as a universal payment instrument (legal tender) alongside physical currency, accepted across all payment platforms and channels. The unveiling of the new Dirham symbol coincides with the CBUAE's recent accession to the FX Global Code, making it the first central bank in the Arab region to do so. This step underlines the UAE's efforts to establish the Dirham as an international currency and promote ethical standards and best practices in the foreign exchange market. Digital Dirham: Advanced Technology and Security The Digital Dirham, issued by the CBUAE, is a secure digital version of the UAE's national currency, leveraging blockchain technology to offer high efficiency, lower transaction costs, enhanced privacy, and robust risk management. Its architecture ensures atomic transaction completion and data protection. Individuals and businesses will be able to access the Digital Dirham through licensed financial institutions such as banks, exchange houses, finance companies, and fintech firms, depending on activated use cases. Retail issuance is expected in the last quarter of 2025. Key features of the Digital Dirham include: Tokenisation: Facilitates digital asset fractionalisation, expands access to liquidity, and enhances financial inclusion and operational efficiency. Smart Contracts: Enables the automated execution and instant settlement of complex, multi-party transactions involving predefined conditions. New Currency Symbol The newly announced Dirham symbol, used for both physical and digital currency, draws inspiration from the English name "Dirham." It incorporates two horizontal lines that represent the stability of the currency, reflecting elements of the UAE flag. The Digital Dirham symbol is distinguished by a surrounding circle and the national flag's colours, symbolising pride, identity, and the nation's forward-looking financial vision. This design reflects the UAE's ambition for global financial integration and highlights its commitment to building a modern, innovative, and internationally competitive financial ecosystem. Integrated Digital Platform and Wallet To support the rollout of the Digital Dirham, the CBUAE has developed a secure and integrated platform that includes a user-friendly Digital Dirham wallet for both individuals and businesses. This wallet supports a range of financial transactions, including: Retail, wholesale, and cross-border payments Money transfers and withdrawals Top-ups and redemptions The system ensures a seamless and efficient user experience aligned with international best practices. It is also built to integrate new financial innovations that cater to emerging use cases driven by the rapid digitalisation of the UAE economy. This contributes to the UAE's goal of developing a resilient and flexible financial system, enhancing its competitiveness as a global financial and digital payments leader. H.E. Khaled Mohamed Balama, Governor of the CBUAE, stated: 'We are proud to unveil the new symbol for the UAE Dirham in both physical and digital forms, as well as the design of the Digital Dirham wallet. This marks a major milestone in the implementation of the Digital Dirham programme and aligns with the Central Bank's strategic vision.' He added:
Al Etihad
27-03-2025
- Business
- Al Etihad
CBUAE unveils new Dirham symbol in conjunction with UAE's joining of FX Global Code
27 Mar 2025 17:00 ABU DHABI (WAM)The Central Bank of the UAE (CBUAE) today unveiled the new symbol for the UAE's national currency, the "Dirham", in a move that embodies the vision of the wise leadership, and the directives and ongoing support of His Highness Sheikh Mansour bin Zayed Al Nahyan, Vice President, Deputy Prime Minister, Chairman of the Presidential Court, and Chairman of the Board of the CBUAE, in strengthening the UAE's position as a leading global financial CBUAE also announced the progress of the Issuance and Circulation of the Digital Dirham, a key initiative of the Financial Infrastructure Transformation (FIT) Programme launched by the CBUAE in 2023, aiming to bolster the UAE's position as a pioneer in Financial Market Infrastructure (FMI) and a destination for excellence in financial products innovation and UAE's Digital Dirham is underpinned by Federal Decree-Law No. (54) of 2023 amending certain provisions of Federal Decree-Law No. (14) of 2018 concerning the Central Bank and Regulation of Financial Institutions and Activities. This will ensure the acceptance of the Digital Dirham as a universal payment instrument (legal tender) in all payment outlets and channels alongside physical unveiling of the new dirham symbol is in conjunction with the CBUAE's recent joining to the FX Global Code, becoming the first central bank in the Arab region to do so, comes as part of the CBUAE's efforts to establish the UAE Dirham as an international currency, along with enhancing the integrity and best practices in the exchange market of the national currency against foreign currencies and promoting ethical practices and sound professional rules for its participants. The Digital Dirham: Technological and Security Advantages The CBUAE issues the "Digital Dirham" as a digital version of the UAE's national currency, characterised by high levels of security and efficiency, contributing to reduced costs of payments through its reliance on blockchain technology, which by its technical design insures effective risk management, data protection/privacy, and atomic transaction and businesses will be able to obtain the Digital Dirham through licensed financial institutions, such as banks, exchange houses, finance companies and fintech companies, according to the use cases that will be activated. The issuance of the Digital Dirham is expected to take place in the last quarter of the year 2025 for retail Digital Dirham offers several key advantages and characteristics that drive development and innovation, including:• Tokenisation: The Digital Dirham facilitates tokenisation, enhancing financial inclusion and efficiency, and expanding access to liquidity through digital asset fractionalisation.• Smart Contracts: The Digital Dirham is used with smart contracts to programme the execution of complex transactions automatically, settling them instantly, in addition to multi-stage and multi-party transactions that involve conditions or obligations. New SymbolIn a move that demonstrates the progress of the Digital Dirham programme, the CBUAE today announced the new symbol for the UAE's national currency in its physical and digital forms. The letter was chosen, derived from the English name of the Dirham, to serve as an international symbol representing the nation's currency, incorporating two horizontal lines that embody the stability of the UAE Dirham and inspired by the UAE flag, to enhance financial and monetary stability. On the other hand, the Digital Dirham symbol features a circle surrounding the physical currency symbol, using the colours of the UAE flag to reflect pride and national identity. The symbol choice serves as evidence of the national currency's global reach and openness to a more prosperous future, and commitment to developing an innovative local financial ecosystem with a global perspective. Integrated Platform and Digital WalletThe 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 characterised 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 Mohamed Balama, Governor of the CBUAE, said, "We are proud to unveil today the new symbol for the UAE's national currency the "Dirham" in both its physical and digital forms, and the design of the Digital Dirham wallet. This reflects the significant advancements in the implementation of the Digital Dirham programme and a leap towards realising the CBUAE's vision." He added, "It is anticipated that the Digital Dirham as a blockchain based platform with cutting edge capabilities shall 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 cost and increasing access to international markets.'
