The promise of stablecoins as a means for facilitating cross-border payments has taken another important step toward realization.
DP World, a logistics company based in Dubai, has announced its own stablecoin, developed in collaboration with several global financial institutions. The stated goal is to streamline transactions across Asia and Africa, where businesses often struggle with slow settlement times, limited access to financing, and a lack of transparency.
“This initiative aligns with DP World’s broader mission to enhance trade flows and economic development in regions that need it most,” DP World Group Chairman & CEO, Sultan Ahmed bin Sulayem said in a statement. “We believe this initiative will redefine the way businesses engage in cross-border trade, particularly in regions where financial barriers have limited potential.”
The announcement comes months after the UAE Central Bank introduced its stablecoin regulation pegged to the country’s dirham to be used for payments on products and services. The dirham itself is pegged to the U.S. dollar, providing an additional layer of stability.
The first regulated stablecoin to be approved was the AECoin last December. The AECoin is intended primarily for use within the UAE. DP World’s stablecoin would become the second to be regulated under the UAE’s authority. Meanwhile, Tether is also awaiting approval for its own UAE stablecoin.
Other stablecoins have been issued by crypto companies, financial institutions, and payment services. PayPal’s cross-border money transfer platform, Xoom, supports the PayPal USD (PYUSD) stablecoin. What sets the DP World stablecoin apart is that it’s the first to be issued by a company specializing in completing cross-border transactions and deliveries.
It remains to be seen whether DP World’s stablecoin will develop use cases outside of cross-border payments in Asia and Africa, or even beyond companies using DP World’s other services.
A Promising Use Case
Using stablecoins for cross-border payments has emerged as a highly promising use case for cryptocurrency. Historically, these payments have long been difficult, characterized by opaque processes, slow speeds, and high costs, further complicated by fluctuating exchange rates.
By bypassing the traditional correspondent banking model, stablecoins can lower transaction costs while increasing transparency and reducing fraud in cross-border payments. Stablecoins also enable peer-to-peer transactions without intermediaries, letting individuals make payments without requiring access to traditional banking systems.
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