BNY has partnered with Abu Dhabi-based Finstreet and the ADI Foundation to develop institutional digital asset custody services for clients in the UAE.
The initial focus is on Bitcoin and Ether custody for existing Finstreet customers, with plans to later expand to the blockchain infrastructure of the ADI Foundation, the world’s largest custodian he said in Thursday’s announcement. The companies said they intend to expand the product range to include stablecoins, tokenized real-world assets and other regulated digital instruments, although no timeline was provided.
“BNY is uniquely positioned to connect traditional and digital financial ecosystems,” said Hani Kablawi, executive vice president of BNY. BNY claimed to be the first global U.S. systemically vital bank to offer digital asset custody services.
The three companies will provide custody services for digital assets from Abu Dhabi Global Market (ADGM), an international financial center and free zone on Al Maryah Island. According to BNY, the initiative is still subject to final agreements and regulatory approvals.
Related: UAE-free zone launches blockchain-based business IDs for registered companies
The stablecoin infrastructure in the United Arab Emirates is expanding
Finstreet is a subsidiary of Sirius International Holding, which is backed by the United Arab Emirates-based conglomerate IHC. IHC recently joined other institutions in launching DDSC, a dirham-backed stablecoin regulated by the UAE Central Bank. The stablecoin operates on ADI Chain, a Layer 2 institutional blockchain developed by the ADI Foundation.
PUSD, a Shariah-compliant stablecoin backed by reserves denominated in Saudi riyals and United Arab Emirates dirhams, is also expected to appear on the ADI chain.
In 2025, ADI Chain signed MoUs with BlackRock, Mastercard and Franklin Templeton related to tokenized asset settlement and digital financial infrastructure.
In recent years, the UAE has continued to develop its regulatory framework for digital assets and tokenization infrastructure, licensing companies including Animoca Brands, BitGo and Binance, while introducing rules for tokenized stocks, ETFs and cryptocurrency derivatives.
Cointelegraph reached out to BNY for comment but did not receive a response via publication.
Related: UAE investors are buying the AI dip, maintaining exposure to cryptocurrencies despite the conflict
UAE stablecoins launch a regulated conversion rail
The collaboration with BNY comes as Abu Dhabi companies delve deeper into regulated digital asset infrastructure.
In an announcement on Thursday, AE Coin and USD Universal said they are building a regulated conversion bus that will enable near-instant exchanges between the UAE dirham-pegged AE Coin and the US dollar-backed stablecoin USDU, targeting institutional payments and treasury management.
The system runs on Al Maryah Community Bank’s infrastructure and will initially be available through Aquanow and Changer.ae, two regulated digital asset service providers in the UAE.
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