Tether and Phoenix Group to launch UAE dirham stablecoin
The new digital money linked to the Emirati currency gives consumers an alternative to Tether’s popular U.S. dollar stablecoin
A physical depiction of the popular digital cryptocurrency Bitcoin. (Photo: Getty Images)
A new stablecoin pegged to the dirham will be launched by Abu Dhabi tech conglomerate Phoenix Group in collaboration with global cryptocurrency company Tether, as the UAE ramps up efforts to become a global hub for the crypto industry.
Stablecoins, a digital currency backed by traditional government currencies such as the U.S. dollar or euro, are designed to keep a consistent value and have seen rapid growth as an alternative to more volatile cryptocurrencies, such as Bitcoin.
The dirham is pegged to the U.S. dollar, meaning that a stablecoin linked to the Emirati currency gives consumers an alternative to Tether’s popular U.S. dollar stablecoin, while maintaining the same currency exposure.
“The main purpose is actually creating an optionality towards the U.S. dollar,” Tether CEO Paolo Ardoino told Reuters. Licensing by the UAE Central Bank is expected to take a few months, with a launch date yet to be announced.
The dirham launch comes as Abu Dhabi’s Blockchain Center partnered with Gate Ventures this week to launch Falcon Gate, a $100 million Web3 innovation fund.