- The Qivalis consortium, which now consists of twelve EU banks, is working hard on the issue of its euro-based stablecoin, which is scheduled to take place in the second half of the year.
- Talks are already being held with international crypto exchanges. The banks involved will also market the Euro stablecoin themselves in order to quickly achieve a wide reach.
Like the one appearing in Madrid CincoDías business newspaper – the Spanish equivalent of the German Handelsblatt – reported in its Monday edition, the Qivalis consortium’s Euro stablecoin is making good progress. There are already discussions about distribution agreements with the world’s major crypto exchanges.
Qivalis CEO Jan Sell, former head of Coinbase in Germany, describes the goal as building an EU alternative to the dollar stablecoins that dominate the market today.
Qivalis looks for its partners among institutions that meet the EU’s MiCA requirements, have solid liquidity and maintain high security standards.
The aim is to provide the complete Euro stablecoin infrastructure from the first official day of distribution. There should be no gradual introduction or transition periods for related services.
The Euro stablecoin will enable real-time transactions and is intended to reduce dependence on existing infrastructure that is difficult to modernize.
Reserve and risk diversification
The stablecoin is backed 1:1 by the euro. At least 40 percent is held as sight deposits at credit institutions with high credit ratings, while up to 60 percent is held in short-term government bonds from several Eurozone countries.
Custody is carried out by a diversified group of institutions that must ensure 24/7 exchange. Qivalis CEO Sell emphasizes:
“Despite the strong balance sheets of the member banks, risk diversification has top priority. The custodians are selected based on creditworthiness, stability and operational reliability.”
Importance for Europe
Although 99 percent of all stablecoins are currently pegged to the dollar, EU banks still see an international market for the euro-based stablecoin, simply because it can make EU companies independent of US infrastructure.
The major Spanish bank BBVA, a new member of the Qivalis consortium, gave up its own stablecoin project that had already started in favor of the joint project in order to avoid fragmentation and to give more weight to the Euro stablecoin that is now being pushed forward.
The Euro stablecoin project thus supports the European Union’s efforts to strengthen its financial independence.
While the European Central Bank is pushing forward the Digital Euro – not as a CBDC, as is often wrongly claimed – the private sector is also working on a Europe-wide real-time transfer system that connects national systems and is intended to create an alternative to the dominance of the US payment services VISA and Mastercard.
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