Tether announced on May 25 that it is partnering with the Government of Georgia to launch GEL₮—a stablecoin pegged to the Georgian lari (GEL), making Georgia one of the first countries to directly put its national currency on-chain through cooperation with private stablecoin operators. The National Bank of Georgia approved stablecoin issuance rules in March 2026. The regulatory framework draws on rules from the United States, the European Union, and Dubai, and explicitly seeks interoperability with U.S. stablecoin regulations.
GEL₮’s Technical and Regulatory Framework: Confirmed Design Directions
In its announcement, Tether confirmed that GEL₮ will serve as an on-chain digital version of the Georgian lari, with the following functional targets: lower transaction fees (compared with traditional payment channels), faster settlement speed (near-instant), programmable payments (allowing payment logic to be embedded in contracts), and more efficient value flow within the digital ecosystem.
On the regulatory front, the stablecoin issuance framework approved by the National Bank of Georgia in March 2026 includes the following confirmed features: legal clarity for digital asset businesses; alignment with international standards for reserve management, compliance, and issuer supervision; drawing on the core principles of three existing regulatory frameworks—the U.S. GENIUS Act (still under review in the Senate), the EU’s MiCA, and Dubai’s VARA; and explicitly seeking interoperability with U.S. stablecoin rules such as the GENIUS Act.
Background on the Global Stablecoin Landscape: Tether’s Market Position
GEL₮’s launch comes amid a backdrop in which Tether’s flagship stablecoin, USDT, has a market cap of about $190 billion, and its daily trading volume regularly exceeds traditional payment giants such as Visa and Mastercard. Ardoino said in the announcement that stablecoins are increasingly becoming “an important part of global financial infrastructure.” Earlier this month, a U.S. NCA report confirmed that more than 67 million U.S. adults hold crypto, with 77% saying crypto has had a positive impact on their lives—showing that demand for stablecoin payment applications is rapidly expanding.
FAQ
What are the fundamental differences between GEL₮ and the potential CBDC (central bank digital currency) that Georgia and the National Bank of Georgia might launch?
GEL₮ is an asset-backed stablecoin issued by Tether (a private company), with reserves denominated in Georgian lari. It is a privately issued, regulated stablecoin, and its technical architecture and business model are similar to USDT. CBDC (central bank digital currency), on the other hand, is digital currency issued directly by the central bank (the National Bank of Georgia), representing central bank liabilities and having legal tender status. GEL₮ is issued through Georgia’s already established stablecoin regulatory framework, allowing private institutions to issue digital assets pegged to fiat currency within a compliant framework—this is Georgia’s chosen “private stablecoin + government cooperation” route, distinct from the CBDC route of central banks directly issuing digital currency such as China’s digital yuan.
Why does Georgia’s stablecoin regulatory framework draw on the U.S. GENIUS Act, even though the GENIUS Act is not yet law?
The GENIUS Act is still in the legislative process in the United States (it has passed the Senate Banking Committee and is awaiting review by the full chamber), but its regulatory framework design (reserve requirements, audit standards, issuer qualifications, etc.) has already become a reference template for stablecoin rules in multiple jurisdictions worldwide. Georgia’s main purpose in drawing on the GENIUS Act is to ensure interoperability with the future direction of U.S. regulation, so that GEL₮ can be accepted and used in U.S. market scenarios or for U.S.-facing institutional clients without requiring large-scale framework restructuring after U.S. legislation is finalized.
What is the significance of this cooperation for Tether’s business strategy?
GEL₮ represents Tether’s strategic expansion from being a single USDT issuer to becoming an infrastructure provider for stablecoins in multiple denominations. Tether previously also supported EURT, which is denominated in euros (although its European operations were restricted by MiCA in 2024). The cooperation model with the Georgian government—Tether providing technology and issuance infrastructure, while the government provides the regulatory framework and legal recognition—is a business template that Tether may replicate in more emerging markets and mid-sized economies. It complements USDT’s dollar-dominant market while sidestepping more stringent regulatory barriers in major developed markets.
