Abu Dhabi Global Market approves USDT as a “recognized virtual asset”, and stablecoins enter a new era

2024-12-11

The Abu Dhabi Global Market (ADGM) has officially approved USDT as a “recognized virtual asset”, opening the door for stablecoins to be integrated into the compliant financial ecosystem, marking a major breakthrough in the global stablecoin market.

According to a statement from USDT issuer Tether, the approval covers USDT on Ethereum, Solana and Avalanche chains, and also means that licensed financial service providers within ADGM can now legally provide USDT-related financial services.

Currently, the market value of USDT has exceeded 138 billion US dollars, firmly maintaining its leading position in the stablecoin market. This recognition not only further consolidates USDT’s market advantage, but also builds a more solid bridge for global stablecoins between traditional finance and digital assets.

Stablecoins are integrated into the mainstream and boost financial innovation

ADGM’s decision not only symbolizes that stablecoins are gradually being accepted by the global financial system, but also reflects the important role of stablecoins in connecting traditional finance and digital asset markets.

However, even as stablecoins are gradually accepted in the global regulatory framework, market concerns about their risks have not subsided. For example, the U.S. Financial Stability Oversight Council (FSOC) has pointed out that the stablecoin market is too centralized, with Tether alone accounting for about 70% of the market value. This structural risk could pose risks of bank runs and systemic collapse.

Tether continues to expand, and the influence of stablecoins cannot be ignored

Despite concerns about the regulation of stablecoins, Tether’s market dynamism cannot be underestimated. In November this year, Tether issued more than $5 billion of USDT in just 72 hours. This large-scale issuance caused the price of Bitcoin to soar to a high of $76,200.

After this issuance, USDT’s market value exceeded $124 billion in early November and climbed to approximately $138 billion after it was approved by ADGM on December 10, once again consolidating its dominance in the stablecoin market.