The UAE government has completed its first national transaction using the Digital Dirham.

The transaction was executed by the Ministry of Finance and the Dubai Department of Finance in collaboration with the Central Bank of the UAE, announced on Tuesday.

This marks a significant milestone in the country’s efforts to integrate advanced financial technology across both the public and private sectors.

Ahmed Ali Meftah, executive director of the Central Accounts Sector at the Department of Finance, stated that the initial pilot transaction was conducted through the mBridge platform, a multi-central bank digital currency settlement system developed by the Central Bank.

He said that the transaction was completed in under two minutes, though details regarding the specific product or service purchased have not yet been disclosed.

The Digital Dirham initiative was introduced as part of the Central Bank’s Financial Infrastructure Transformation Programme, in partnership with local financial authorities.

The project aims to accelerate the UAE’s shift toward digital payments and strengthen its position as a global hub for financial innovation.

Sheikh Mansour bin Zayed, Vice President, Deputy Prime Minister, and Chairman of the Central Bank of the UAE, described the Digital Dirham as a “strategic pillar” in the nation’s vision to build an integrated digital economy.

He said the first government-to-government transaction highlights the UAE’s advanced technical infrastructure and the strong level of integration within its national financial system, The National reports.

Whereas Sheikh Maktoum bin Mohammed, Deputy Prime Minister and Minister of Finance, said this was a “pivotal moment in the history of government financial transformation in the UAE” in a post on X.

The transaction aligns with the broader progress of the UAE’s digital asset strategy. The nation has been developing regulatory frameworks for stablecoins and digital currencies, underscoring that utility, clear regulation, and institutional adoption are key factors for their long-term success.

Experts told The National in April that jurisdictions providing clear regulations for digital assets are more likely to attract institutional investment and encourage practical, real-world adoption.

The UAE’s Central Bank launched its Digital Dirham strategy in March 2023, with local regulations requiring stablecoins to be fully backed by high-quality liquid assets and subjected to regular audits.

Furthermore, back in April, Abu Dhabi-based entities IHC, ADQ, and First Abu Dhabi Bank announced plans to introduce a dirham-backed stablecoin that will operate under full regulation by the UAE Central Bank.