Euro stablecoin project adds 25 new banks

By Elizabeth Howcroft and ‌Jesús Aguado

PARIS, May ​20 (Reuters) - ​Twenty-five more banks, including lenders ABN Amro and Sabadell, have joined a European consortium planning to launch a euro-pegged cryptocurrency later this ‌year, the group said on Wednesday.

The consortium - which set up ⁠an Amsterdam-based company called Qivalis last year - now has 37 financial institutions as members, including ‌ING, BNP Paribas and BBVA, ‌from 15 countries.

The project is framed as a way to counter U.S. dominance in digital payments, as well as participate in a possible ​future system where assets such as bonds and real estate are traded as blockchain-based crypto tokens, although the European Central Bank is sceptical ⁠about the benefits.

"The euro is Europe's currency, and on-chain financial infrastructure should carry it - built by European ​institutions and governed by European rules," Qivalis CEO Jan-Oliver Sell said in the statement.

The 25 new members include: Dutch lenders ​ABN Amro and Rabobank, Spanish lenders Sabadell ‌and Bankinter, Bank of Ireland, Sweden's Handelsbanken and Finland's Nordea, among others.

Various news outlets had reported earlier in May ⁠that some of the banks were due to join.

The crypto industry is increasingly competing with mainstream financial institutions, putting traditional lenders under pressure to find uses for ⁠blockchain technology within their own businesses.

Stablecoins - a type of cryptocurrency pegged to a fiat currency - ​are mostly used in crypto trading, and have surged in size in recent years. The market is dominated by El Salvador-based Tether and U.S.-based Circle, which say they ‌have around $190 billion and $77 billion of their dollar-pegged tokens in circulation respectively.

Still, there are few signs of demand for ‌euro-pegged alternatives. Societe Generale's crypto arm, SG-FORGE - which is not part of Qivalis - ⁠launched a euro-pegged stablecoin in ‌2023, but it has ​just 105.6 million euros ($122.40 million) worth of tokens in circulation.

($1 = 0.8627 euros)

(Reporting by Elizabeth Howcroft and Jesús Aguado; editing by ‌Philippa Fletcher)

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