VARA's FRVA rules make Dubai stablecoin issuance an approval regime with a hard AED boundary

Dubai's Virtual Assets Regulatory Authority did not open a general-purpose stablecoin payments lane on 19 May 2025.

Dubai's Virtual Assets Regulatory Authority did not open a general-purpose stablecoin payments lane on 19 May 2025.

It published a rule set for fiat-referenced virtual asset issuance that is narrow in three ways: each FRVA needs ex ante approval, AED-linked instruments sit outside VARA and within the Central Bank of the UAE's perimeter, and VARA-approved FRVAs may be used only inside the virtual-asset market.

The companion rules then add the operating controls institutional readers usually care about—full reserve backing, legal separation of reserves from house assets, par redemption within one working day, and monthly independent audits backed by management attestation.

On 19 May 2025, VARA published a revised Virtual Asset Issuance Rulebook that requires approval before each fiat-referenced virtual asset is issued, places AED-linked instruments in the Central Bank of the UAE's perimeter, and restricts VARA-approved FRVAs to virtual-asset-market use rather than general payments.