On August 21, the leading stablecoin issuer made a groundbreaking announcement. Tether unveiled a stablecoin tied to the United Arab Emirates dirham (AED) in collaboration with Phoenix Group PLC and Green Acorn Investments Ltd. This move signifies a strategic partnership between Tether and two prominent UAE-based companies, fostering innovation in the digital asset space.
Cross-Border Transactions and Remittances Simplified
The newly introduced stablecoin will be fully backed by liquid UAE-based reserves, adhering to Tether’s stringent reserve standards. This initiative aims to provide users with a stable digital representation of the local currency, enhancing accessibility and usability in the UAE's crypto landscape. The Dirham-backed stablecoin underscores Tether's commitment to supporting the region's booming crypto industry.
Tether's CEO, Paolo Ardoino, emphasized the importance of this development, emphasizing the UAE's emergence as a key global economic hub. He views the Dirham-pegged stablecoin as a valuable addition for Tether's users, offering a cost-effective solution for leveraging the benefits of the AED in an increasingly digitized economy.
The collaboration with Phoenix Group PLC, a prominent tech conglomerate in Abu Dhabi, aims to equip businesses and individuals in the UAE with essential digital transaction tools. Seyed Mohammad Alizadehfard, the co-founder and Group CEO of Phoenix Group, expressed enthusiasm for the partnership, emphasizing the firm's dedication to delivering innovative financial solutions.
Seizing Opportunities in the UAE's crypto Industry
The launch of the Dirham-pegged stablecoin aligns with the UAE's growing status as a hub for cryptocurrency and blockchain innovation. The country's recent surge in crypto investments, fueled in part by the establishment of the Virtual Asset Regulatory Authority (VARA) in Dubai, underscores the region's attractiveness to industry players.
Tether's latest initiative coincides with its activities on the TRON blockchain, where the company has minted an additional $1 billion USDT tokens. This move reflects Tether's commitment to expanding its presence in the crypto market and meeting the evolving needs of users across different platforms.
Forecasts suggest substantial growth in the global stablecoin market, projecting a value of $2.8 trillion by 2028. Against this backdrop, the UAE's embrace of cryptocurrencies is further evidenced by a recent court ruling supporting salary payments in crypto under employment contracts. The ruling reflects a progressive approach to integrating digital currencies into the country's regulatory and economic frameworks.
The UAE's recognition of crypto-based salary payments sets a precedent for leveraging digital assets in traditional financial transactions. This development underscores the region's forward-thinking stance on cryptocurrencies and positions the UAE as a favorable jurisdiction for crypto-related activities.
Overall, Tether's launch of the Dirham-pegged stablecoin marks a significant step towards bolstering the UAE's crypto ecosystem. By providing a stable digital representation of the local currency and streamlining cross-border transactions, Tether aims to support the region's financial innovation and enhance accessibility to digital assets for businesses and individuals alike.
