RAKBANK Receives In-Principle Approval to Issue AED-Backed Stablecoin

RAKBANK has informed the market that it has received in-principle approval from the Central Bank of the UAE to issue an AED-backed stablecoin, subject to the completion of regulatory and operational requirements.

The update was shared as part of a statement outlining the bank’s latest progress in digital assets, and comes as UAE regulators continue to formalize the role of bank-issued payment tokens within the country’s financial system.

A Direction Set Early

While the announcement marks a regulatory milestone, the initiative itself is not new. RAKBANK was among the early UAE banks to apply for a stablecoin license, reflecting a leadership-level decision to engage with digital assets through regulated banking channels rather than through experimental structures.

This direction has been visible in the bank’s recent product decisions, positioning the stablecoin as a continuation of an existing strategy rather than a standalone innovation.

From Access to Infrastructure

That strategy became clearer in 2025, when RAKBANK became the first conventional bank in the UAE to enable retail crypto trading directly through its mobile banking app, via a regulated partnership with Bitpanda.

By integrating digital asset access within its own banking environment, RAKBANK signaled an intention to normalize crypto exposure under institutional supervision — a step that now logically extends toward on-chain payment and settlement infrastructure.

Progress Under the Central Bank Framework

The in-principle approval places RAKBANK in an advanced stage of the Central Bank’s payment token framework, pending the completion of audits, operational testing, and final regulatory clearances.

Only one AED-backed stablecoin is currently live in the market, while other bank-led initiatives remain in preparation and another one waiting the IPA. RAKBANK’s update reflects the Central Bank’s approach of prioritizing readiness and oversight over rapid deployment.

Why the Reserve Language Stands Out

A notable element of the bank’s statement is its reference to:

“Audited smart contracts with real-time reserve attestations, supporting transparency and operational integrity.”

The phrasing is careful. Rather than committing to a specific disclosure mechanism, RAKBANK highlights that the stablecoin’s design supports real-time reserve attestations — signaling architectural alignment with regulatory expectations around transparency and auditability, without pre-empting how such features may be implemented.

What Comes Next

RAKBANK said further updates related to pilot testing and potential expansion will be shared in due course, subject to regulatory approvals.

The announcement does not signal an immediate launch, but reinforces the bank’s intent to participate in the next phase of regulated digital finance — where banks move beyond enabling crypto access and toward issuing and operating on-chain payment instruments.