As a seasoned crypto investor with a keen eye for promising ventures and a deep understanding of the global market, I find Tether’s announcement of a stablecoin pegged to the UAE Dirham an intriguing development. Having witnessed the explosive growth of various digital assets in recent years, I am always on the lookout for innovative projects that can potentially reshape the landscape of the industry.
Tether, a well-known international stablecoin provider, is intending to introduce a new stablecoin that will maintain a one-to-one equivalence with the United Arab Emirates Dirham (AED). As stated in a recent announcement on Wednesday, this upcoming coin will be supported by liquid UAE reserves, mirroring Tether’s commitment to maintaining stability and trust in its value.
At this point, the newly-conceived digital currency, known as the stablecoin, is undergoing its initial growth phase. Tether has collaborated with Phoenix Group PLC, a leading tech company in the Middle East, and Green Acorn Investments Ltd, to facilitate the launch of this stablecoin in the market.
A Transformative Impact
Collaboratively, these three entities aim to keep the Dirham-backed digital token, acting as a virtual equivalent of the local currency, consistently stable and in line with the value of its underlying reserves.
According to Seyedmohammad Alizadehfard, one of the founders at Phoenix Group, digital assets are expected to bring about significant change within the cryptocurrency market in the United Arab Emirates.
“It’s exciting for us to collaborate with Tether in launching a stablecoin tied to the UAE Dirham, which we believe has the power to revolutionize the digital economy for users not only within the region but globally,” he stated.
Upon its release, the newly introduced product will be part of Tether’s existing lineup of stablecoins, such as USDT tied to the U.S. dollar, EURT linked to the Euro, MXNT related to Mexican pesos, CNHT corresponding to Chinese yuan, and XAUt that mirrors the price of actual gold.
According to Tether, this innovative digital currency retains a one-to-one equivalence with the UAE Dirham, offering users the advantages of blockchain technology. This digital coin intends to minimize transaction costs and accelerate the pace and clarity of transactions by transferring transactions onto the blockchain network.
A Game-Changer for UAE Users
According to Tether’s CEO, Paolo Ardoino, the new stablecoin linked to the UAE Dirham is designed to meet the needs of businesses and individuals who want a more dependable and affordable method for handling financial transactions. This will be particularly beneficial for cross-border payments, trading activities, and asset diversification.
Introducing this digital asset could simplify global trading and money transfers (like remittances), which are major hurdles for businesses and investors dealing within the UAE market, as it also provides protection against changes in currency values.
Under the Central Bank’s recently unveiled Payment Token Services Regulation, the stablecoin tied to the Dirham will be subject to regulation.
Ardoini underscored that the introduction of the stablecoin within the UAE would offer a substantial enhancement for customers residing in the area.
According to Ardoino, the United Arab Emirates is rapidly growing as an international economic powerhouse, and he feels that our Dollar-linked digital coin would serve as a beneficial and multifunctional asset for our customers.
Rising Crypto Usage in the UAE
The upcoming release of the AED-supported digital currency, known as a stablecoin, coincides with a period of rapid expansion in cryptocurrency adoption within the UAE. This growth can primarily be attributed to the creation of the Virtual Asset Regulatory Authority (VARA), a pioneering global entity that functions as an independent regulator for the crypto sector.
Due to a welcoming legal climate, cities such as Dubai and Abu Dhabi have emerged as top choices for cryptocurrency businesses aiming to grow within that geographical area.
The current global stablecoin market is estimated at around $150 billion, with USDT accounting for more than $115 billion of that total. Experts predict that this market could surge to an impressive $2.8 trillion by 2028. This growth trend places the UAE in a strategic role as a significant contributor in the development of digital finance for the future.
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2024-08-21 17:55