Tether has scored a major regulatory milestone. Abu Dhabi authorities have formally recognized USDT, allowing licensed institutions to integrate the stablecoin into custody and trading operations. The Abu Dhabi Global Market announced the designation Monday, expanding regulated access to the world’s largest stablecoin by circulation.
The recognition classifies USDT as an accepted fiat-referenced token, enabling ADGM-licensed companies to build financial services around it. The move broadens previous approvals that were limited to specific blockchain networks, opening the door for a wider range of institutional use cases.
Tether CEO Paolo Ardoino framed the approval as validation of stablecoins’ growing role in modern finance. USDT has become a cornerstone for international money transfers, payment settlements, and a stable value store in volatile crypto markets.
Licensed firms can now offer institutional custody, cross-border payments, and integration into settlement systems, all under clear regulatory oversight. The designation provides legal certainty for companies developing infrastructure around dollar-pegged digital assets.
Ripple’s RLUSD stablecoin received similar recognition, signaling that Abu Dhabi is open to multiple stablecoin providers rather than favoring a single issuer.
Local financial institutions are moving fast as well. A consortium including the ADQ sovereign wealth fund, International Holding Company, and First Abu Dhabi Bank announced plans to launch a dirham-backed stablecoin, pending central bank approval. This would create a locally issued alternative pegged to the UAE currency rather than the dollar.
Global stablecoin circulation has surpassed $300 billion, more than doubling in two years as adoption accelerates. Abu Dhabi is positioning itself as a regional hub for digital asset activity, offering regulatory frameworks that balance operational certainty with oversight. Its international financial center has attracted exchanges, custody providers, and blockchain companies seeking compliant pathways to operate.
Traditional financial institutions are taking note. Banks and payment processors increasingly view dollar-pegged tokens as tools to speed up cross-border payments and reduce settlement costs compared to conventional correspondent banking.
The regulatory approval comes as stablecoins shift from primarily serving crypto traders to supporting broader payment and treasury functions. Institutional adoption is rising as tokens demonstrate real-world value in managing dollar exposure and enabling rapid cross-border transfers.
