The Central Bank of Bahrain has launched a stablecoin regulatory framework to allow fiat-backed stablecoins

On September 18, the Central Bank of Bahrain (CBB) launched a stablecoin issuance and sale (SIO) regulatory module, becoming the first comprehensive regulatory framework of its kind in the Gulf Cooperation Council (GCC) region.
The framework allows only fiat-backed stablecoins, which can be anchored to Bahraini dinars, US dollars, or other fiat currencies expressly approved by the central bank. Algorithmic or commodity-backed stablecoins are prohibited. Issuers are required to obtain a central bank license, meet strict prudential standards, including maintaining reserves in high-quality liquid assets, and undergo regular external audits. The scope of regulation covers the entire ecosystem, including custodians, wallet providers, and payment service providers. The framework is aligned with international standards, with particular emphasis on anti-money laundering and counter-terrorism financing requirements.