BNY has partnered with Abu Dhabi-based Finstreet and ADI Foundation to develop institutional digital asset custody services for clients in the United Arab Emirates.
The initial focus is on Bitcoin and Ether custody for Finstreet’s existing clients, with plans to later extend to ADI Foundation’s blockchain infrastructure, the world’s largest custodian said in a Thursday announcement. The companies said they intend to expand the product scope to include stablecoins, tokenized real-world assets and other regulated digital instruments, though no timeline was given.
“BNY is uniquely positioned to connect traditional and digital financial ecosystems,” Hani Kablawi, executive vice chair at BNY, said. BNY claimed it is the first US global systemically important bank to offer digital asset custody.
The three firms will offer digital asset custody services from the Abu Dhabi Global Market (ADGM), an international financial center and free zone on Al Maryah Island. The initiative remains subject to definitive agreements and regulatory approvals, according to BNY.
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UAE stablecoin infrastructure expands
Finstreet is a subsidiary of Sirius International Holding, which is backed by UAE 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, an institutional layer-2 blockchain developed by ADI Foundation.
PUSD, a Shariah-compliant stablecoin backed by reserves denominated in Saudi riyals and UAE dirhams, is also expected to launch on ADI Chain.
In 2025, ADI Chain signed memoranda of understanding with BlackRock, Mastercard and Franklin Templeton tied to tokenized asset settlement and digital financial infrastructure.
The UAE has continued developing its digital asset regulatory framework and tokenization infrastructure in recent years, licensing firms including Animoca Brands, BitGo and Binance while introducing rules covering tokenized stocks, ETFs and crypto derivatives.
Cointelegraph reached out to BNY for a comment, but had not received a response by publication.
Related: UAE investors buy AI dip, keep crypto exposure despite conflict
UAE stablecoins launch regulated conversion rail
The BNY collaboration comes as Abu Dhabi firms push deeper into regulated digital asset infrastructure.
In a Thursday announcement, AE Coin and USD Universal said they are building a regulated conversion rail that allows near-instant exchange between the UAE dirham-pegged AE Coin and the US dollar-backed USDU stablecoin, targeting institutional payments and treasury management.
The system runs on Al Maryah Community Bank’s infrastructure and will initially be accessible through Aquanow and Changer.ae, two regulated digital asset service providers in the UAE.
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