Tether’s USDt, the largest stablecoin by circulation, has secured a significant regulatory milestone in Abu Dhabi’s international financial center, paving the way for licensed institutions to utilize the token in regulated financial services.
Announced on Monday, USDt (USDT) has been formally recognized as an “accepted fiat-referenced token.” This designation permits regulated firms operating within the Abu Dhabi Global Market (ADGM) to offer a range of services that include trading, custody, and other transactions involving the stablecoin.
The ADGM, an international financial center and a free economic zone, has increasingly attracted digital asset companies that are seeking clear regulatory frameworks and institutional access to the digital asset space.
Paolo Ardoino, Tether’s CEO, commented on the designation, stating that it “reinforces the role of stablecoins as essential components of today’s financial landscape.” This statement highlights the growing utility of stablecoins in areas such as remittances, cross-border settlements, and the broader digital asset markets.
Previously, the ADGM had classified USDT as an accepted virtual asset for its issuance on the Ethereum, Solana, and Avalanche blockchains. The latest recognition further solidifies and expands this framework, potentially enhancing USDT’s usability for cross-border payments, institutional custody solutions, and settlement processes.
Abu Dhabi's Strategic Focus on Stablecoins in Finance
Tether's USDt is not the only stablecoin experiencing increased traction in Abu Dhabi. Local regulators have recently approved Ripple’s dollar-pegged RLUSD, recognizing it as an accepted fiat-referenced token and thereby enabling its institutional use.
These developments coincide with heightened anticipation surrounding a separate initiative supported by some of Abu Dhabi’s most prominent financial entities. A consortium comprising ADQ, the emirate’s sovereign wealth fund, the International Holding Company, and First Abu Dhabi Bank has unveiled plans for a dirham-pegged stablecoin, which is currently awaiting approval from the UAE Central Bank.
Abu Dhabi, and the wider UAE, are emerging as significant participants in the evolving stablecoin and digital asset markets. This prominence is attributed to a comparatively clear regulatory environment within a region already established as a global commercial hub. The ADGM, in particular, has become a key venue for licensing various entities, including exchanges, custodians, and other crypto-focused firms that are seeking structured regulatory oversight.