The United Arab Emirates has completed its first transaction using the country’s central bank digital currency (CBDC) — marking the first major milestone for the Digital Dirham project since its announcement in March.
In a joint statement on Tuesday, the UAE Ministry of Finance and Dubai Finance confirmed that the transaction took place as part of the pilot phase and utilized the government’s cross-border payment platform, mBridge.
The agencies described the development as a significant step toward wider adoption of the Digital Dirham across both government and private sector operations.
This marks the first major update since the UAE Central Bank announced in March that the Digital Dirham rollout was expected to begin in the fourth quarter of 2025.
Test Transaction Completed in Under Two Minutes
Ahmed Ali Meftah, Executive Director of Central Accounts at Dubai Finance, said the transaction was completed in under two minutes and was conducted to “test operational readiness and ensure seamless technical integration with the Central Bank’s systems.”
“The transaction was completed in less than two minutes, underscoring its goal of enhancing operational efficiency and expediting financial settlements between federal and local government entities.”
Rollout to Happen in Phases
In a policy paper published in July, the UAE Central Bank described the Digital Dirham as an initiative to future-proof central bank money and adapt to the demands of a rapidly evolving digital economy.
The paper noted that the CBDC rollout will occur in phases, with the initial launch focusing solely on payments. This limited scope is intended to prevent competition with savings products and other interest-bearing financial instruments.
Central Bank Digital Currencies (CBDCs) remain a contentious topic globally. Critics warn they could erode privacy and disrupt traditional banking by allowing individuals to transact directly with central banks. Supporters, however, argue that CBDCs can improve payment efficiency, reduce costs, and enhance financial inclusion.
Only Three CBDCs Successfully Launched So Far
Governments around the world continue to explore CBDC initiatives. In October, Kyrgyzstan announced plans to issue its own central bank digital currency, while the European Central Bank moved forward with the next stage of its digital euro project.
Despite this momentum, only three CBDCs have been fully launched, according to data from the Atlantic Council. Its CBDC tracker identifies Nigeria, the Bahamas, and Jamaica as the only jurisdictions with active digital currencies, while 49 other countries remain in the pilot phase.
