UAE dirham stablecoin race expands as RAKBank gains approval

RAKBank has received in-principle approval from the Central Bank of the United Arab Emirates to issue a dirham-backed payment token.

The approval allows the bank to proceed subject to meeting final regulatory and operational requirements before launch.

RAKBank said the planned stablecoin will be fully backed one-to-one by dirhams held in segregated regulated accounts.

The token will be governed by audited smart contracts with real-time reserve attestations, according to the bank.

The move marks a new phase in RAKBank’s digital asset strategy following its 2025 entry into retail crypto trading.

This is an important milestone in our digital assets journey.

Raheel Ahmed said.

He added that the initiative reflects a focus on innovation that is responsible, regulated and built on trust.

The UAE has developed a multi-agency digital asset framework covering stablecoins, tokenised products and service providers.

Policymakers see dirham-backed tokens as a way to modernise payments and improve cross-border transaction efficiency.

The stablecoin market now includes telecom firms and global issuers alongside local banks.

Market observers say questions remain around blockchain infrastructure, interoperability and user adoption.