The Bahrain Central Bank (CBB), which published the Stablecoins Conference Paper in October 2024, issued a full stubcoin regulation on July 2, 2025. CBB.
The Bahrain Central Bank noted that following consultations with the industry, CBB is publishing modules and their appendixes based on CBB Rulebook Volume 6 (see Module SIO and its appendix attachment). CBB noted that the new module will be enabled soon.
CBB allows approved stablecoins borne yield
Additionally, the Bahrain central bank allows stubcoin issuers to issue stability that burdens the yield that pays passive returns to clients only from interest or compensation earned from investments in reserve assets (for stubcoins in accordance with Sharia).
CBB adds that Stablecoin issuers who provide approved stubcoins with yields should set yield or reward rates to a level that does not adversely affect the stability of approved Stablecoin (stableness of the financial health (concern) of the Stablecoin issuer).
CBB sets strict requirements for Stablecoin publishers
According to the module, you need to manage and protect the issuer who is trying to provide stubcoins and control the total supply, or the mint and burns, as well as the management of reserve assets and stubcoins.
Central Bank Bahrain regulations require current authorized entities who want to provide regulated Stablecoin services to seek written approval from the CBB before providing services. The document states, “Stablecoin publishers should provide CBB with a detailed description of the new services, the resources required, and the operational framework for such services.”
All service providers must obtain a license before receiving the Stablecoin service.
CBB notes that some of the Stablecoin approvals include considering the quality and liquidity of Stablecoin, as well as the credit and concentrated risk reserve assets of those currencies. We also note that the central bank may refuse an application for issuance of stubcoin if it determines that its issuance is likely to cause, dilute or oppose the benefit of the national economy, the holder of stubcoin, or the general general investor.
Stablecoin reserves are cash reserves of banks with AA ratings
With regard to the composition of reserve assets, the issuer of Stablecoin may maintain the reserve in cash and deposits only in cash and deposits with a minimum bank charge of AA or equivalent or equivalent deposits, or in debt securities with the central bank, or in a buyback agreement that supports short-term government money market funds.
Applicants must also have at least three years of experience in publishing Stablecoins and working in Crypto Asset domains. Regarding licensing fees, CBB has launched a variable annual license fee paid by the Stablecoin issuer, which is 0.25% of the related operating expenses, subject to a minimum charge of BD 5000 and a minimum charge of BD 12,000.
The CBB also provides a detailed discussion of governance and compliance requirements, and focuses on this. As CBB noted, Stablecoin issuers must have the right and proper systems and management in accordance with the requirements for financial crime prevention and combating.
Bahrain Central Bank regulations are far ahead of the UAE Central Bank’s stubcoin regulations
The new stubcoin regulations set by the Bahrain Central Bank far outweigh the stubcoin regulations set by the UAE Central Bank. The UAE allowed AED stubcoins to be considered a domestic payment method, while CBB allowed them to issue both Bahraini Dinar and USD Stablecoins, as well as Sharia compliant.
Another notable difference is that CBB has allowed stubcoins to carry yields. This is something the UAE central bank did not mention in its regulations.
