Tether, the world’s largest stablecoin issuer, today announced plans to issue a stablecoin pegged to the UAE dirham (AED) in collaboration with Phoenix Group, Tether said in a statement on Wednesday.
According to the company, the dirham-pegged stablecoin will be fully backed by UAE-based liquid reserves to ensure stability and security. It aims to provide users with a seamless and cost-effective way to transact in AED both locally and internationally. The token is expected to play a key role in streamlining trade, remittances and reducing transaction fees within and outside the UAE.
“The UAE is becoming an important global economic hub, and we believe our dirham-backed token will be valuable and versatile for our users,” Tether CEO Paolo Ardoino said.
According to Tether, the global stablecoin market is expected to reach $2.8 trillion by 2028. Tether’s U.S. dollar-pegged USDT currently has $117 billion in circulation and dominates the $169 billion stablecoin market.
The token launch comes at a time when the UAE is rapidly embracing digital technology and solidifying its position as a global financial centre. The UAE has seen a surge in cryptocurrency adoption in recent years, triggered by the establishment of the Virtual Asset Regulatory Authority (VARA). Dubai and Abu Dhabi have emerged as global hubs for innovation in virtual assets and blockchain technology, attracting a large number of companies and investors.
Dubai’s Virtual Asset Regulation Will Attract Cryptocurrency Firms, Investors
Dubai has announced licensing and authorization requirements for virtual asset companies and issuers wanting to operate in the emirate.
“Abu Dhabi’s progressive attitude towards blockchain, digital assets and innovation will make the country the perfect launch pad,” said Seyyed Mohammad Alizadefard, co-founder and group CEO of Phoenix Group.
In other UAE crypto news, a recent landmark ruling by the Dubai Court of First Instance allows cryptocurrencies for the payment of salaries under employment contracts, marking a significant step towards the wider acceptance and integration of cryptocurrencies in the UAE.