📊 Q3 Earnings are here! Plan ahead with key data on upcoming stock reports - all in 1 placeSee list

Tether plans new stablecoin pegged to UAE dirham

Published 21-08-2024, 06:14 pm
© Reuters
USD/AED
-
AED/USD
-
USDT/USD
-
USDT/USD
-

Tether, the company behind the $114 billion USDT token, plans to launch a new stablecoin pegged to the United Arab Emirates (UAE) dirham

The yet-to-be-named stablecoin will be rolled out in collaboration with UAE-based tech giants Phoenix Group PLC and Green Acorn Investments Ltd. While the companies did not provide a specific launch date, Tether CEO Paolo Ardoino said obtaining licensing from the Central Bank of the UAE will be the next step, and could take a few months.

The Dirham-pegged stablecoin will be fully backed by liquid UAE-based reserves, following Tether’s reserve standards to “ensure stability and trust in its value,” Ardoino said in a press release. 

The new token is expected to streamline international trade and remittances, reduce transaction fees, and provide a hedge against currency fluctuations.

The UAE’s central bank has already paved the way to regulate cryptocurrencies pegged to real assets. In June, it approved a plan to oversee and license stablecoin arrangements, specifically those backed by the UAE dirham. 

While the details are still being ironed out, the step is part of the UAE's push to become a leader in crypto space under its Financial Infrastructure Transformation Programme. 

Currently, stablecoins not backed by the dirham are regulated by Dubai's Virtual Assets Regulatory Authority (VARA). While there are still some questions over how existing payment service providers will be affected, the proposed framework creates a clear path for regulated stablecoins in the UAE.

Tether’s expansion into the UAE market comes as the issuer continues to expand its services beyond its flagship USDT, which is the largest stablecoin by market value and a key component of the digital asset ecosystem.

The company has recently launched USDT on the Aptos blockchain to reduce gas fees to “only a fraction of a penny,” it said in a statement earlier this week.

Tether's USDT is available on multiple blockchains, with Tron leading the way at $60.73 billion in net circulation, followed by Ethereum at $52.59 billion.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.