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Tether, a leading issuer in the stablecoin market, has announced ambitious plans to introduce a new stablecoin pegged to the United Arab Emirates Dirham (AED). This development, unveiled in a recent press release, marks a significant expansion for Tether into the UAE’s burgeoning crypto landscape.
The new stablecoin will be launched in collaboration with two prominent UAE-based entities: Phoenix Group PLC and Green Acorn Investments Ltd.
Backed by UAE-based liquid reserves
The Dirham-pegged stablecoin will be fully backed by UAE-based liquid reserves, adhering to Tether’s commitment to maintaining robust reserve standards.
This move aligns with the UAE Central Bank’s recently introduced Payment Token Services Regulation, under which Tether plans to seek regulatory approval. The regulatory framework is expected to boost the stablecoin’s acceptance, given Dubai and Abu Dhabi’s growing prominence as crypto hubs.
Paolo Ardoino, CEO of Tether, emphasized the strategic importance of the UAE as a global economic hub, stating that the Dirham-pegged stablecoin aims to offer businesses and individuals a secure and efficient means of transacting in AED.
Ardoino said that they are thrilled to add the new stablecoin to their portfolio. He said that the new stablecoin is designed to streamline international trade and remittances, reduce transaction fees, and provide a hedge against currency fluctuations.
The collaboration with Phoenix Group PLC, a major tech conglomerate listed in Abu Dhabi, and Green Acorn Investments Ltd., reflects Tether’s strategy to leverage local expertise and infrastructure.
Seyed Mohammad Alizadehfard, Co-Founder and Group CEO of Phoenix Group, expressed enthusiasm about the partnership saying that their joint efforts with Tether are poised to transform the digital economy in the region, offering users a valuable tool for financial transactions.
The growing list of fiat-pegged stablecoins by Tether
Tether’s new Dirham-pegged stablecoin will join an existing lineup that includes stablecoins pegged to the US Dollar, Euro, Chinese Yuan, and Mexican Peso. This expansion is part of Tether’s broader strategy to diversify its stablecoin offerings and tap into new markets.
The global stablecoin market, valued at approximately $150 billion, is projected to experience significant growth, potentially reaching $2.8 trillion by 2028.
The introduction of the Dirham-pegged stablecoin also follows Tether’s recent initiatives, including the launch of USDT on the Aptos blockchain and the digital asset backed by Swiss-stored gold, Alloy.
By integrating with local regulatory frameworks and collaborating with regional partners, Tether aims to enhance its market presence and contribute to the UAE’s evolving digital financial ecosystem.
As the UAE continues to emerge as a pivotal player in the crypto and blockchain sectors, Tether’s new stablecoin is set to play a crucial role in facilitating digital transactions and supporting the region’s economic growth.
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