Tether, a leading name in the exciting world of stablecoins, has big news. The global powerhouse plans to unveil a token pegged to the United Arab Emirates’ dirham. The company is joining hands with the Abu Dhabi-based crypto conglomerate, Phoenix Group, and Green Acorn Investments for this venture.
Stablecoins are digital assets typically pegged to a fiat currency, offering users an antidote to the often tumultuous volatility of other cryptocurrencies like bitcoin. The largest stablecoins are pegged to the all-powerful U.S. dollar and Tether’s own USDT securely holds the top spot. With a staggering market cap of over $117 billion, USDT dominates nearly 70% of the stablecoin market, according to CoinGecko data.
In terms of fiat currencies other than the U.S. dollar, Tether’s euro equivalent (EURT) has a market cap of barely $30 million. But Tether is looking to shake things up. The dirham-based stablecoin is part of the company’s strategy to seek licensing under the U.A.E. central bank’s Payment Token Services Regulation, introduced in June. Given the established crypto-friendly reputation of Dubai and Abu Dhabi, this could boost the new stablecoin’s profile.
Tether CEO, Paolo Ardoino, believes the dirham-backed stablecoin will be a powerful and versatile asset, especially as the United Arab Emirates is cementing its place as an important global economic hub. He sees the stablecoin as an invaluable tool for businesses and individuals needing secure and efficient transaction methods in dirham, from cross-border payments to diverse trading strategies.
This development not only strengthens Tether’s position as a leader in the stablecoin market but also gives users access to a new, secure, and potentially lucrative crypto option.