The United Arab Emirates has taken a key step in its central bank digital currency (CBDC) initiative, completing its first transaction using the Digital Dirham. The Ministry of Finance and Dubai Finance confirmed on Tuesday that the pilot transaction, executed through the government’s mBridge payment platform, marks a significant milestone in the UAE’s ongoing digital finance transformation.
According to the agencies, the transfer represents the first-ever use of the national digital currency by the UAE government. It signals progress toward wider adoption across public and private sectors.
Testing readiness and integration
Dubai Finance’s Executive Director of Central Accounts, Ahmed Ali Meftah, explained that the transaction was designed to assess the system’s operational readiness and ensure smooth technical integration with the Central Bank’s infrastructure.
Today, Ministry of Finance & Dubai Finance marked a pivotal milestone in the history of government financial transformation in the UAE, as we executed the first government transaction using the Digital Dirham issued by the Central Bank of the UAE, representing the future of the… pic.twitter.com/gYRiTC1Euh
— Maktoum Bin Mohammed (@MaktoumMohammed) November 11, 2025
He noted that the entire process took less than two minutes, showcasing the potential of the Digital Dirham to streamline settlements and boost efficiency in financial operations between federal and local entities.
Phased rollout planned for 2025
The UAE Central Bank (CBUAE) first announced its Digital Dirham project in March, projecting a full rollout by the fourth quarter of 2025. In a July policy paper, the bank described the initiative as an effort to
“future-proof central bank money”
amid the global shift toward digital economies.
The rollout will occur in phases, with the first stage focusing exclusively on payment functionalities. This limited scope is meant to prevent competition with traditional banking products such as savings or interest-bearing accounts.
Also Read: HSBC Launches TradeCash in UAE as Digital Financing Demand Grows
CBDCs receive attention globally
While many countries are still testing their CBDCs, only a handful have fully launched them. Data from the Atlantic Council’s CBDC tracker shows that only Nigeria, the Bahamas, and Jamaica currently operate live CBDC systems. Another 49 nations remain in pilot stages, including the UAE, which now joins a growing list of active testers alongside the European Central Bank and Kyrgyzstan.
Despite increasing momentum, CBDCs remain controversial. Critics warn of potential privacy risks and disruptions to the financial sector, while proponents highlight their ability to enhance payment efficiency and broaden financial inclusion.
Dubai Is testing digital assets alongside the Digital Dirham
In October 2025, Dubai Finance and the Dubai Land Department conducted a technical implementation allowing digital assets to be settled instantly in UAE dirhams for government service fees.
The test involved DubaiPay, the Digital Dubai Authority and a CBUAE-licensed digital-asset platform. The transaction was conducted as part of a controlled implementation before a potential future launch. This is notable because it shows the UAE working on infrastructure connecting cryptocurrency, tokenized assets and central bank money rather than developing each system in isolation.
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