Stablecoin innovation is advancing rapidly, with major developments shaping the digital asset landscape. In Dubai, the Financial Services Authority (DFSA) has officially approved Circle’s USDC and EURC as recognized tokens, allowing businesses in the Dubai International Financial Centre (DIFC) to integrate them into financial services. Meanwhile, Tether’s USDT is expanding its interoperability with the launch of Super USDT on the OP Superchain, a crosschain initiative led by Celo, Chainlink, Hyperlane, and Velodrome.
Dubai Financial Services Authority Grants Official Recognition to Circle’s USDC and EURC Stablecoins
The Dubai Financial Services Authority (DFSA) has officially approved Circle’s USD Coin (USDC) and EURC (EURC) as recognized tokens under its crypto regime. This milestone marks the first stablecoins to receive regulatory approval under Dubai’s cryptocurrency framework, reinforcing the emirate’s status as a hub for digital asset innovation.
With this approval, companies operating within the Dubai International Financial Centre (DIFC) can now integrate USDC and EURC into various financial applications, including payments, treasury management, and digital asset services. This development is expected to enhance liquidity and facilitate seamless financial transactions across industries in the Middle East’s premier financial hub
The DIFC, established in 2004, has evolved into a key economic zone for businesses operating in the Middle East, Africa, and South Asia (MEASA). The district currently hosts nearly 7,000 active companies, a 25% increase from 2023, signaling a growing interest from global financial firms in Dubai’s regulatory environment.
Under Dubai’s digital asset regulations, only recognized crypto tokens are allowed for use in DIFC operations. The DFSA’s move to recognize Circle’s stablecoins aligns with the broader regulatory clarity emerging in the United Arab Emirates (UAE) as it positions itself as a leader in the global crypto market.
The approval of USDC and EURC comes amid a wave of pro-crypto regulations in the UAE, designed to foster innovation while ensuring investor protection.
In June 2024, the Central Bank of the UAE introduced a stablecoin oversight and licensing framework, providing regulatory clarity for companies issuing and using fiat-backed digital assets. That same month, Dubai revised its crypto token rules for investment funds, allowing both foreign and domestic entities to invest in digital assets—further legitimizing the role of stablecoins and other cryptocurrencies in the region’s financial ecosystem.
The DFSA’s decision to greenlight Circle’s stablecoins follows a broader trend of expanding stablecoin use cases in the UAE, from remittances and cross-border payments to treasury operations and institutional finance.
While Circle has secured its position in Dubai’s DIFC, its primary competitor, Tether (USDT), has been making inroads elsewhere in the UAE.
In December 2024, Tether’s USDT became a recognized virtual asset in Abu Dhabi, the UAE’s capital. In a strategic move, Tether also partnered with UAE-based Reelly Tech to integrate USDT into the region’s booming real estate market, allowing property transactions to be settled in the stablecoin.
The battle between Circle and Tether for stablecoin dominance in the Middle East reflects the increasing institutional and retail demand for reliable digital assets. While USDC is gaining momentum with regulatory approvals and financial integrations, USDT remains the dominant stablecoin globally, holding a 63% market share, according to DefiLlama.
Circle’s USDC has been experiencing significant growth, with its market capitalization increasing from $45.6 billion to $56.3 billion between Jan. 8 and Feb. 10, 2025—marking a 23.4% rise.
Dubai’s Role in the Global Crypto Economy
Dubai’s recognition of USDC and EURC as regulated tokens reinforces its ambition to become a global leader in digital assets and blockchain innovation. By implementing clear regulations and fostering public-private partnerships, the UAE is setting a precedent for how governments can balance innovation with financial stability.
As Dubai continues to expand its digital asset ecosystem, Circle’s latest approval could pave the way for further stablecoin adoption across the region. Given the ongoing growth of USDC and its increasing regulatory approvals, Circle may soon challenge Tether’s dominance in key international markets.
With Dubai’s strategic position as a financial hub and the UAE’s progressive crypto policies, the competition between stablecoin giants Circle and Tether is set to intensify, shaping the next chapter of digital finance in the Middle East.
Tether’s USDT Expands Crosschain Capabilities with Super USDT on the OP Superchain
In related news, Tether’s USDt, the world’s most widely used stablecoin, has taken a significant leap in interoperability with the launch of Super USDT, a crosschain version of the token deployed on the OP Superchain. This move, spearheaded by Celo, Chainlink, Hyperlane, and Velodrome, aims to enhance liquidity and streamline stablecoin accessibility across the Optimism-powered Layer 2 ecosystem.
Announced on Feb. 18, Super USDT is backed by equivalent reserves of USDT locked on Celo, an Ethereum Layer-2 scaling solution. Unlike traditional bridged stablecoins, which often fragment liquidity across chains, Super USDT seamlessly integrates with the entire OP Superchain, aligning with Optimism’s vision of a unified, interoperable digital economy.
Super USDT’s crosschain functionality is powered by:
Chainlink’s Cross-Chain Interoperability Protocol (CCIP)
Hyperlane, an open interoperability framework
These technologies ensure secure and seamless movement of USDT across the OP Superchain without liquidity fragmentation, a major problem in the current stablecoin landscape.
Currently, bridged stablecoins create liquidity silos, limiting their effectiveness across different chains. The introduction of Super USDT eliminates this issue, ensuring that USDT liquidity can be used seamlessly across all Optimism-based chains.
Johann Eid, Chief Business Officer at Chainlink Labs, highlighted the critical role of Chainlink’s infrastructure in supporting USDT’s lending markets. He noted that Chainlink’s Data Feeds currently secure $3.7 billion in USDT deposits and $2.2 billion in borrows on Aave v3’s Core Ethereum deployment alone. By enhancing crosschain movement, Super USDT further optimizes capital efficiency across DeFi protocols.
The Super USDT stablecoin is already live on multiple Layer-2 networks within the OP Superchain, including:
Base
Fractal
Lisk
Metal
Mode
Optimism
Soneium
Superseded
Unichain
World Chain
This broad availability expands USDT’s accessibility for developers and users, further reinforcing its role as the backbone of digital transactions in DeFi.
Tether’s USDt remains the dominant player in the stablecoin market, boasting a market capitalization of over $140 billion and accounting for 61% of the total $231 billion stablecoin sector, according to CoinMarketCap.
However, competition is intensifying:
Circle’s USDC continues to gain traction among institutional investors due to its regulatory compliance and transparency.
Dai (DAI), issued by MakerDAO, is widely used in DeFi applications, leveraging decentralized governance and collateral-backed issuance models.
Despite this rising competition, Tether remains the primary liquidity source for many DeFi applications, centralized exchanges, and remittance solutions.
Super USDT’s launch comes amid an industry-wide push toward crosschain stablecoin solutions, ensuring that stablecoins can operate seamlessly across multiple blockchains without requiring fragmented liquidity pools.
Tether has already invested heavily in interoperability, with integrations into The Open Network (TON) and Arbitrum, further expanding the crosschain functionality of USDT.
According to Steven Goldfeder, CEO of Offchain Labs (Arbitrum’s developer), increasing interoperability will be a key driver of USDT’s adoption, helping it scale across different blockchain ecosystems.
Stablecoins are Outpacing Traditional Payment Networks
Stablecoin transactions have already surpassed traditional payment giants like Visa and Mastercard in terms of value processed.
In 2024, stablecoin transaction volume hit a record $15.6 trillion, according to ARK Invest.
This surpasses the annualized transaction volumes of Visa and Mastercard, marking a shift in how global payments are settled.
As stablecoins become integral to digital commerce, DeFi, and cross-border transactions, innovations like Super USDT will be crucial in shaping the next phase of financial infrastructure.
The launch of Super USDT on the OP Superchain represents a major milestone in the evolution of stablecoin infrastructure. By solving liquidity fragmentation issues and improving crosschain interoperability, Tether’s USDT further cements its dominance in the DeFi and digital payments space.
With Tether, Circle, and decentralized stablecoins like Dai competing for market share, the stablecoin industry is set for continued innovation, broader adoption, and deeper integration into both traditional finance and decentralized ecosystems.
As blockchain scalability solutions continue to evolve, stablecoins will play an increasingly central role in shaping the global financial landscape.
