Rabobank and ABN AMRO have joined a group of European banks to launch a euro-based stablecoin. The initiative aims to provide a European alternative in a market currently dominated by US-backed stablecoins.
The project builds on earlier plans announced last year. A group of banks, including ING, set up a new company called Qivalis. The consortium has since grown to include 37 financial institutions.
A stablecoin is a digital currency that is tied to a fixed value, in this case, the euro. This means its value remains stable at one euro per coin. While euro-pegged stablecoins already exist, they are less widely used than those linked to the US dollar.
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According to Qivalis, the new euro stablecoin will use blockchain technology and is intended to become a “trusted European payment standard”. The banks said such a system is “essential if Europe wants to compete in the global digital economy while simultaneously preserving its strategic autonomy”.
Stablecoins are considered ‘backed’ cryptocurrencies because they track the value of assets such as currencies, oil or gold. This differs from ‘unbacked’ cryptocurrencies like Bitcoin, whose prices can fluctuate sharply. Stablecoins enable the swift transfer of money across borders, often at a lower cost than traditional bank transfers.
The consortium includes banks such as Banca Sella, KBC, Danske Bank, DekaBank, UniCredit, SEB, CaixaBank, BBVA, BNP Paribas, Bank of Ireland and Raiffeisen Bank.
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