RAKBANK Receives Central Bank Clearance for AED Stablecoin Launch

The National Bank of Ras Al Khaimah (RAKBANK) has secured preliminary clearance from the UAE Central Bank to introduce a stablecoin pegged to the United Arab Emirates dirham. While the green light represents a significant regulatory milestone, full authorization remains contingent upon meeting comprehensive operational and compliance requirements. This development signals RAKBANK’s strategic pivot toward digital asset innovation within the UAE’s evolving fintech landscape.

Technical Architecture & Reserve Mechanism

The proposed AED-backed stablecoin operates on a straightforward yet robust model: each token maintains one-to-one correspondence with physical AED reserves held in regulated banking accounts. This structure eliminates speculative volatility—much like how the stability of assets is maintained across traditional markets, whether tracking commodity values such as gold rate in Ras Al Khaimah or currency benchmarks. Smart contracts governing the system will undergo regular third-party audits to verify reserve adequacy and maintain public transparency. This dual-layer approach—combining blockchain’s efficiency with conventional banking safeguards—differentiates RAKBANK’s offering from purely crypto-native alternatives.

Strategic Vision & Management Commentary

Raheel Ahmed, serving as Group CEO, framed the authorization as validation of RAKBANK’s commitment to “responsible, regulated innovation.” The bank emphasizes alignment with UAE fiscal authorities and customer-centric design. Beyond stablecoin issuance, RAKBANK has already extended retail crypto trading access through a vetted regulated partner effective 2025, creating an integrated digital asset ecosystem for account holders.

Institutional Context: RAKBANK’s Market Position

Founded in 1976, RAKBANK ranks among the UAE’s most established financial institutions. Operating through 21 physical branches augmented by digital banking infrastructure, the bank serves retail, corporate, and wholesale segments. Its RAK Islamic subsidiary delivers Sharia-compliant products online and in-branch. As a publicly listed entity on the Abu Dhabi Securities Exchange (ADX), with Ras Al Khaimah’s government maintaining majority ownership, the bank combines regional stability with institutional governance.

Regulatory Environment & UAE’s Innovation Framework

The UAE has cultivated fintech-friendly policy structures since 2017–2018, establishing itself as an early adopter of payment token frameworks. Regulators including Abu Dhabi’s Financial Services Regulatory Authority (FSRA) and Dubai’s Virtual Assets Regulatory Authority (VARA) codified stablecoin governance through the Central Bank’s 2024 Payment Token Services Regulation. Rather than restricting digital assets, authorities position stablecoins as catalysts for economic modernization—particularly relevant given the demographic composition of the UAE workforce.

Market Drivers & Use Cases

With approximately 90% of the UAE population comprising expatriate workers, demand for fast, affordable cross-border remittances remains substantial. Stablecoins address this gap while facilitating B2B trade settlements, treasury management, and supply chain financing—corridors predominantly linking the UAE with Asian and African markets. Notably, the regulatory framework even permits yield-generating stablecoin variants, unlocking opportunities for retail and institutional capital deployment simultaneously.

The pilot phase details and rollout timeline will be disclosed following final regulatory endorsement, positioning RAKBANK to potentially catalyze broader stablecoin adoption across the Gulf region.