ING is part of a European banking consortium for a so-called euro stablecoin, which is scheduled to be issued for the first time in the second half of next year. To facilitate this, the banks have created a new Dutch company that will operate under the supervision of De Nederlandsche Bank (DNB).
Stablecoins are digital coins that are linked to a fixed value, in this case, the euro. At present, the stablecoin market is largely dominated by the US dollar. The consortium also includes banks such as Banca Sella, KBC, Danske Bank, DekaBank, UniCredit, SEB, CaixaBank, and Raiffeisen Bank.
The euro stablecoin will be regulated under the European MiCAR (Markets in Crypto-Assets Regulation) framework for cryptocurrencies. This rule requires that every euro of a fiat-backed stablecoin must be fully backed by actual cash or liquid assets. They are also subject to rigorous transparency and reporting rules, along with anti-money laundering and consumer protection obligations.
The euro stablecoin is intended for fast, low-cost payments and settlements, both domestically and cross-border. It will also streamline the settlement of digital assets and securities, and could become a trusted digital payment standard across the European ecosystem.
“The initiative will provide a truly European alternative to the US-dominated stablecoin market, contributing to Europe’s strategic autonomy in payments,” the banks said.
The consortium welcomes additional banks to join and announced that a board chairman will be appointed shortly. The banks say the euro stablecoin is intended to “serve as a trusted European payment standard within the digital ecosystem.”
