With Central Bank’s Blessing, Georgia Taps Tether for ‘Official’ Stablecoin

Tether said Monday it plans to issue a stablecoin in Georgia with backing from the country’s government, underscoring the country’s aggressive push to establish itself as a crypto hub uniquely aligned with U.S. regulations.

The stablecoin, called GELT, will serve as a digital representation of the Georgian lari, Tether said in a statement announcement. It described this move as one of “the first concerted efforts to put a national currency directly on the digital asset track” under a purpose-built framework.

With a population of about 3.9 million people, the country is actively laying the foundation for “a more connected, transparent and digitally enhanced financial world” through GELT, Georgian Prime Minister Irakli Kobakhidze said in a statement.

The stablecoin is positioned as a turning point for the region, promising citizens near-instant settlements, lower transaction fees and a direct bridge between Georgia’s traditional banking system and growing digital economy.

Tether’s leading stablecoin, USDT, assignments a market capitalization of almost $190 billion. Monday’s announcement reflects efforts to expand the stablecoin issuer’s dominance beyond the U.S. dollar: The company already issues tokens pegged to the price of the euro, British pound, Mexican peso and gold. Yet none of these tokens carry the explicit backing of a sovereign national government or its central bank.

Tether noted on Monday that the government and the National Bank of Georgia had previously spent years crafting a regulatory framework for digital assets, establishing rules that align with those issued in the US under the GENIUS Act last year. These include requirements regarding reserve management, redemption rights and issuer supervision.

Georgia already allows residents to pay taxes in digital assets that are converted into the country’s local currency. In 2023, the country’s central bank tapped Ripple to test a digital version of Georgia’s national currency using the Ripple CBDC platform.

“The National Bank of Georgia welcomes collaboration with global innovators like Tether as part of its broader strategy to advance a secure, modern and internationally aligned digital financial infrastructure,” Natia Turnava, president of the National Bank of Georgia, said in a statement.

Monday’s post hinted at future details, but there is no indication that GELT will function as a central bank digital currency, or CBDC. Unlike stablecoins, which are issued by private companies on public networks, CBDCs are controlled and maintained by their respective governments –sparkling Concerns about financial oversight among conservatives.