Tether Dirham-pegged Stablecoin Launched With Fully Backed 1:1 By UAE’s Central Bank

Key Points:

• Tether is partnering with Phoenix Group to launch a stablecoin pegged to the UAE Dirham, supported by Green Acorn Investments.
• The Tether Dirham-pegged stablecoin will be built on a secure blockchain platform, backed by UAE-based reserves, and regulated under the UAE Central Bank.

Tether, the biggest issuer of stablecoins, is reportedly planning to release a new stablecoin pegged to the United Arab Emirates Dirham (AED).

Tether Dirham-pegged Stablecoin Launched

The program is partnered with the UAE-based Phoenix Group, a multibillion-dollar technology conglomerate listed on the Abu Dhabi Securities Exchange. Powered by Green Acorn Investments, the partnership is all about launching a digital currency that is looking to fill the gap between traditional finance and the digital economy.

The Tether Dirham-pegged stablecoin will track the value of the UAE Dirham—one of the world’s most stable currencies—providing a safe and reliable digital asset for investors, businesses, and consumers alike. The global stablecoin market is currently estimated at $150 billion but is projected to reach $2.8 trillion by 2028, effectively positioning this new initiative as a possible game-changer across the digital assets landscape.

This means that the Tether Dirham-pegged stablecoin will be based on state-of-the-art blockchain technology to ensure safety, transparency, and high efficiency. It would therefore be fully backed 1:1 by liquidity in reserves here in the UAE and issued under the United Arab Emirates Central Bank’s June rule for the Payment Token Services Regulation. Tether would apply for licensing under this regime to be fully compliant.

The recent initiative by Tether boosts crypto innovation in the UAE

The CEO of Tether, Paolo Ardoino, commented that Tether Dirham-pegged stablecoin might become an “essential tool” for companies and people seeking a “secure and efficient” form of transacting via Dirham. The new asset would further international trade and remittances, operating as a hedge against currency fluctuations.

The move comes after earlier launches of the fiat currency-pegged stablecoin issuances by Tether, such as the euro-backed EURT and the Chinese yuan-backed CNHT. Despite these launches, the market capitalization of its flagship USDT, now above $117 billion, stays unmatched in the stablecoin market.

Regulatory crypto wealth within the UAE, especially after the establishment of VARA, has firmly placed Dubai and Abu Dhabi as hubs for crypto and blockchain innovation.