Tether, the issuer of the globe’s foremost stablecoin, has unveiled intentions to create a new token pegged to the United Arab Emirates dirham. This venture will be realized in collaboration with Phoenix Group (PHX), a prominent crypto entity listed in Abu Dhabi.

Stablecoins, which are digital assets anchored to traditional fiat currencies, offer a buffer against the erratic fluctuations that often impact cryptocurrencies like Bitcoin (BTC). The dominant stablecoins, all tethered to the U.S. dollar, see Tether’s USDT as the foremost player with a commanding market capitalization exceeding $117 billion. USDT holds approximately 70% of the stablecoin market.

In contrast, stablecoins pegged to other currencies are relatively insignificant in size. For instance, Tether’s euro-pegged stablecoin (EURT) has a market cap of merely $30 million.

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Tether is gearing up to apply for licensing under the U.A.E. central bank’s Payment Token Services Regulation, which was announced in June. This regulatory framework could enhance the token’s prospects, particularly given the burgeoning status of Dubai and Abu Dhabi as pivotal crypto hubs.