The National Bank of Ras Al Khaimah has received in-principle approval from the Central Bank of the United Arab Emirates to issue a stablecoin backed by the UAE dirham, marking another step in the country’s push to integrate blockchain-based money into its regulated financial system.
According to a statement published by Zawya, RAKBANK has secured conditional authorisation to proceed with the project, subject to meeting remaining regulatory and operational requirements set by the central bank. The planned stablecoin will be pegged one-to-one to the dirham and fully backed by AED reserves.
The bank said the token will be supported by segregated reserve accounts and designed to allow holders to redeem at par value. RAKBANK also pointed to the use of audited smart contracts and reserve transparency mechanisms as part of its design, reflecting growing regulatory expectations around stablecoin governance and consumer protection.
Raheel Ahmed, Group Chief Executive of RAKBANK, described the approval as an important milestone in the bank’s digital assets strategy, positioning the stablecoin as a bridge between traditional banking and blockchain-based payments. The bank has already been active in the digital asset space, including offering customers access to crypto trading through regulated partners.
The move comes as UAE authorities seek to establish the country as a global hub for digital finance while maintaining tight regulatory oversight. The Central Bank of the United Arab Emirates has been developing a comprehensive framework covering crypto assets, stablecoins, and the forthcoming Digital Dirham CBDC, with an emphasis on financial stability and compliance.
For the UAE payments market, bank-issued dirham stablecoins could offer faster settlement, programmability, and new use cases in areas such as tokenised assets and cross-border transactions, while remaining anchored to the existing monetary system. At the same time, regulators have made clear that full launches will depend on meeting strict prudential and operational standards.
If approved for full rollout, RAKBANK would become one of the first conventional banks in the UAE to issue an AED-backed stablecoin, underlining how stablecoins are increasingly being shaped not only by crypto firms, but by licensed banks operating within established regulatory regimes.