Tether announced that its stablecoin, the USD₮ has been accepted as a virtual asset (AVA) by the Financial Services Regulatory Authority (FSRA) in the Abu Dhabi Global Market (ADGM).
This means that authorized persons who operate and are licensed by the FSRA, ADGM’s regulatory body can offer pre-approved services related to USD₮.
Per the announcement, the UAE, with its dirham pegged to the U.S. dollar, serves as a global benchmark for economic stability. Tether’s USD₮ has surpassed $138 billion in market cap and is the world’s most widely used stablecoin. It has over 400 million users globally, and it provides a relatively stable experience as a trusted, efficient bridge between traditional fiat systems and digital economies.
Cryptocurrency adoption in the UAE has been on the up since 2022.
“This milestone underscores Tether’s commitment to fostering global financial inclusion and innovation. By bringing USD₮ to the forefront of ADGM’s regulated virtual asset framework, we are not only validating the importance of stablecoins as critical tools for modern finance but also opening new doors for collaboration and growth across the Middle East,” said Paolo Ardoino, CEO of Tether.
According to Ardoino, the UAE’s forward-thinking approach to virtual asset regulation sets a global benchmark. He believes the USD₮ can play a pivotal role in driving economic progress and digital transformation in the region.
Tether announces plans for AED-Tether stablecoin
Months earlier, Tether had announced that it was seeking a license to launch a dirham-pegged stablecoin after the UAE Central Bank issued its Payment Token Framework.
The company explained that the stablecoin will give users a cheap and seamless way to use AED for transactions via blockchain. It added that it will be crucial for cross-border transfers and remittances within the UAE’s financial ecosystem.
At the time, Tether CEO Paolo Ardoino described it as a huge one for the UAE, noting that it would become a valuable and versatile tool for users. He said, “We’re pleased to announce this initiative to develop Tether’s Dirham-pegged stablecoin, adding to our range of stablecoin options.”
Progress in stablecoin development in the UAE
Today, AE Coin also announced it had become the first to receive an AED stablecoin license from the Central Bank of UAE. As per the announcement on Khaleej Times, a local UAE newspaper, the AE Coin is expected to revolutionize the financial services landscape. It promises an instant, secure, stable, innovative, low-cost, and efficient payment experience that will reshape the future of the digital economy.
In other news about stablecoin milestones, Circle, the issuer of USDC also announced it was opening its offices in the UAE.
As per the announcement, Circle has also entered into a partnership with LuLu Financial Holdings (LuLuFin) and its affiliates, one of the largest financial services conglomerates in the region. Through the partnership, Circle will facilitate remittances and cross-border payments with USDC, its fully reserved digital dollar.
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