The government of Georgia has announced a partnership with USDT issuer Tether to launch GEL₮, an official stablecoin for the country.
Tether To Launch Stablecoin Based On The Georgian Lari
As announced on its website, Tether has partnered up with the government of Georgia for a stablecoin. A “stablecoin” is a type of cryptocurrency that has its price tied to a fiat currency. Currently, tokens of this type based on a range of currencies are available in the market, but the most dominant ones are those based on the US Dollar.
Tether is the issuer of one such USD-pegged stablecoin called USDT. In fact, based on the market cap, the firm’s asset ranks the largest among fiat-tied cryptocurrencies and third overall in the sector as a whole.
Now, the company is looking to release a new stablecoin in collaboration with the Georgian government. This token, known as GEL₮, will be based on the Georgian Lari, the official currency of the country. “This marks one of the first joint efforts to place a national currency directly onto digital asset rails under a purpose-built stablecoin regulatory framework,” noted the announcement.
The move is one among many being made by governments around the world when it comes to stablecoin regulation. A major win for the sector has been the GENIUS Act enacted in the United States last year. According to Tether’s press release, Georgia’s framework has been designed to achieve compatibility with the GENIUS Act and other US regulation.
Irakli Kobakhidze, prime minister of Georgia, said:
Together with visionary partners like Tether, Georgia is laying the foundations for a more connected, transparent, and digitally empowered financial world
Georgia already has an advanced system in place for digital asset payments, with regulated intermediaries allowing conversion of cryptocurrencies into local currency for real-world settlements.
Paolo Ardoino, Tether CEO, noted:
Georgia has moved early to create serious regulatory architecture for digital assets and stablecoins, and that clarity creates the foundation for real innovation and adoption.
Further details related to GEL₮ like its release date and rollout structure are still unknown, with the press release noting that they will be announced at a later date.
The positive regulatory momentum related to stablecoins around the world recently has meant that the sector has held up relatively well during the past few months even as the wider digital asset market has struggled. As data from DefiLlama shows, the combined market cap of the stablecoins has been enjoying an uptrend.
The trend in the market cap of the stablecoins over the years | Source: DefiLlama
Currently, the market cap of these assets is sitting at $322.7 billion, which is around an all-time high (ATH).
Bitcoin Price
At the time of writing, Bitcoin is trading around $77,400, up 0.7% over the past week.
Looks like the price of the coin has rebounded from its dip | Source: BTCUSDT on TradingView
Featured image from Dall-E, chart from TradingView.com
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