The world’s largest stablecoin provider, Tether (behind $USDT), is launching a new coin pegged to the AED.
As the first-ever cryptocurrency licensed under the UAE Central Bank’s new Payment Token Services Regulation, it will open new ways for individuals and businesses to easily use AED worldwide.
Let’s explore what this means for the dirham and the UAE’s financial stability.
The UAE is Capitalizing on the $150B Stablecoin Market
The UAE is capitalizing on the stablecoin market’s success, valued at $169B+ and poised to hit $3T in 2028 – an estimated 1,675.15% rise in just four years.
Developed alongside the investment giants Green Acorn Investments and Phoenix Group, the Tether-developed stablecoin will be pegged 1:1 to AED and underpinned by liquid dirham reserves.
It will boost the dirham in several ways:
Ultimately, Tether’s main aim is for the dirham-tied stablecoin to seamlessly be used across borders through various methods.
Tether’s AED-Pegged Coin May Follow $USDT’s Footsteps
The success of Tether’s $USDT, with a $117B+ market cap, bodes well for the dirham-pegged currency.
$USDT’s popularity (it accounts for 65% of the global stablecoin market) highlights the potential of the upcoming stablecoin to significantly benefit the UAE’s financial landscape.
Although AED is already one of the most stable currencies, Tether’s latest initiative offers a transparent, cost-effective, and efficient way to carry out UAE transactions worldwide, likely boosting it to even greater heights.
In addition, it suggests bright days ahead for Tether, which also has a gold-backed stablecoin and ones pegged to the euro, Mexican peso, and Chinese yuan.
Verdict – Stablecoins Enhance Investor Trust
Stablecoins’ stability makes them an attractive choice because they are pegged to traditional currencies (and even gold).
Additionally, they comply with financial regulations, boost investor confidence, and are held on the blockchain, which makes their transactions transparent and immutable.
Overall, their reliability and seamless accessibility makes them an attractive financial tool, signaling positive times for the UAE and Tether.
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Leah Alger Senior Crypto Journalist 
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