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Tether's USDT Officially Recognized as Virtual Asset in Abu Dhabi

Abu Dhabi officially recognizes Tether's USDT as an accepted virtual asset.

3 min December 10, 2024

Highlights:

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Abu Dhabi officially recognizes Tether’s USDT as an accepted virtual asset for financial services.

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USDT operates on multiple blockchains, strengthening Abu Dhabi’s digital finance and innovation goals.

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FSOC warns of risks in stablecoins despite Tether’s market cap reaching $138 billion.

Tether's USDT Officially Recognized as Virtual Asset in Abu Dhabi

Tether (USDT) is now officially approved as an accepted virtual asset in Abu Dhabi. The Abu Dhabi Global Market Financial Services Regulatory Authority (ADGM-FSRA) made this decision. Licensed financial service providers can now use USDT in their operations.

 

USDT Gains Approval for Broader Use

 

 

ADGM’s approval allows USDT to operate on multiple blockchains, including Ethereum, Solana, and Avalanche. Financial institutions can now offer services linked to USDT under strict regulatory guidelines. This move supports Abu Dhabi’s goal of becoming a leader in digital finance innovation.

 

Stablecoins like USDT connect traditional finance with blockchain markets. ADGM’s approval signals confidence in these assets driving economic opportunities. This positions Abu Dhabi as a strong financial hub with innovative growth potential.

 

Risks and Regulatory Concerns Remain

 

While stablecoins offer opportunities, they also bring risks. The United States Financial Services Oversight Council (FSOC) continues to raise concerns. FSOC warns that stablecoins lack uniform risk management and are vulnerable to financial instability.

 

Tether controls about 70% of the stablecoin market, adding to these concerns. FSOC points out risks like bank runs and systemic financial exposure. Despite these warnings, Tether recently minted over $5 billion in just 72 hours.

 

This minting spree caused USDT’s market cap to climb dramatically. On November 6, $1 billion was minted as Bitcoin hit $76,200. By late November, USDT’s market cap reached $138 billion following ADGM’s approval.

 

Abu Dhabi’s decision shows strategic growth and a step toward integrating blockchain into finance. Tether’s USDT is no longer just a stablecoin. This recognition secures its role as a major player in financial systems worldwide.

 

 

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