- Regulatory Approvals and Licenses
- Liquidity Plans for AED Stablecoin
- Role of AED Stablecoin Beyond the UAE
Tether, a global leader in digital assets and the issuer of the USDT stablecoin, has announced plans to launch a new stablecoin pegged to the United Arab Emirates Dirham. The company is set to collaborate with the UAE’s leading tech conglomerate, Phoenix Group, with support from Green Acorn Investments.
Regulatory Approvals and Licenses
According to Munaf Ali, Co-Founder and CEO of Phoenix Group, the company is working closely with all UAE stakeholders to ensure compliance with regulatory requirements. The company plans to obtain an operational license from the UAE Central Bank, which recently announced its payment token services regulation.
Liquidity Plans for AED Stablecoin
Set to launch in 2025, after obtaining all necessary regulatory approvals, each token of the Dirham-pegged stablecoin will be fully backed by liquid UAE-based reserves. Ali also shared expectations about the liquidity of the upcoming stablecoin, projecting it to exceed half a billion AED. He specified that with USDT’s $120 billion market capital, the AED stablecoin is expected to reach 10-20% of this figure within two years.
Role of AED Stablecoin Beyond the UAE
Ali believes that the role of the UAE Dirham-pegged stablecoin will extend beyond the country itself. He highlighted that one of the main reasons and benefits of launching the AED stablecoin is that it can be utilized outside of the UAE for payments or as a hedge against currency fluctuations. He is convinced that the AED stablecoin will become an essential tool for businesses and individuals seeking secure and efficient means of transaction both inside and outside the UAE.
The partnership with Phoenix Group marks a significant milestone for Tether and could become the company’s largest project in the UAE. Phoenix Group, as the first blockchain and crypto entity listed on the Abu Dhabi Exchange, and a major investor in the regulated crypto exchange M2, stands as a reliable partner for Tether in launching the Dirham-pegged stablecoin. Previously, Tether has collaborated with other leaders in digital assets in the UAE and Turkey.
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