UAE-based RAKBANK is the first to receive regulatory approval for an AED-backed stablecoin. The launch of a regulated digital dirham by a major traditional bank is a big step forward.
RAKBANK Gears Up for Regulated AED Digital Currency
RAKBANK (National Bank of Ras Al Khaimah) has successfully achieved a major regulatory goal by receiving approval from the Central Bank of the UAE (CBUAE) for the development and issuance of an AED-Pegged Stablecoin.
The approval is subject to RAKBANK meeting all final regulatory and operational requirements. This represents a major step for one of the oldest financial institutions in the United Arab Emirates to offer its customers access to the AED-backed regulated digital currency. For instance, the new stablecoin will be supported by the trust in traditional banking as well as the efficiencies and programmability afforded by blockchain technology.
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Building on a Foundation of Trust and Compliance
As stated by RAKBANK in their recent press release, they have announced plans for an AED-backed stablecoin that adheres to a high level of transparency and security, required by authorities. This new virtual currency will be 1:1 backed by funded AED held in segregated and regulated accounts, providing customers with a 100% guarantee of receiving their funds in the same quantity as the purchase.
Moreover, in order to be aligned with best practices, the bank is also working to implement an international auditing process and provide independent verification on each issued stablecoin. This initiative is powered by RAKBANK’s ongoing commitment to creating a safe and secure digital environment through its expansive digital ecosystem services, which include a regulated crypto brokerage for retail customers launched in 2025.
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Supporting the UAE Government’s Vision for a Digital Economy
RAKBANK’s latest in-principle approval for its AED backed stablecoin shows that the UAE government and financial institutions are committed to adopting trendy innovations as it creates a definitive and well-controlled regulatory environment.
To this point, this approval highlights the growing trend of traditional banks embracing blockchain initiatives as a modern approach for payment processing and digital assets ownership.
Finally, this new stablecoin should provide consumers with a viable new bank-based alternative to existing global stablecoins, providing the inherent trust and local support afforded by a licensed UAE-based financial institution and establishing the country as a leader in the digital asset space in the region.
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