Tether Gold has been officially recognized as an Accepted Spot Commodity by the Abu Dhabi Global Market (ADGM), the financial free zone in the United Arab Emirates’ capital. The designation, announced Monday by Tether, allows regulated firms operating within ADGM to offer services involving the gold-backed stablecoin as a tokenized commodity.
The move marks a significant milestone for tokenized commodities, which have struggled to gain regulatory clarity across major financial centers. ADGM’s Financial Services Regulatory Authority (FSRA) maintains a framework for digital assets that classifies tokenized commodities as a distinct category, enabling firms with the appropriate permissions to custody, trade, and advise on such instruments.
“This recognition underscores the growing acceptance of tokenized real-world assets within regulated financial frameworks,” said Paolo Ardoino, CEO of Tether, in a statement. “Abu Dhabi is positioning itself as a global hub for digital asset innovation, and this recognition paves the way for broader institutional adoption of tokenized gold.”
Each XAUT token represents one troy fine ounce of physical gold stored in Swiss vaults. Since its 2020 launch, Tether Gold has grown to over $600 million in market capitalization, making it the largest gold-backed token by market share. The ADGM recognition could accelerate institutional adoption, particularly among wealth managers and family offices in the Middle East seeking regulated exposure to digital gold.
The FSRA’s framework, updated in 2023, requires tokenized commodity issuers to maintain full reserves, undergo regular audits, and meet custody standards equivalent to traditional commodities. Tether Gold’s recognition suggests the issuer has met these requirements.
Source: Cointelegraph
