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France’s 3rd biggest bank by assets and Western Europe’s 7th biggest has stolen a march on competitors by launching EUR CoinVertible its own stablecoin.
3rd largest bank in France launches EUR CoinVertible
Société Générale will become the first big bank to offer digital tokens tracking the price of hard currencies to a wide range of investors.
Dubbed EUR CoinVertible, the stablecoin will be available of crypto exchange Bitstamp, based in Luxembourg.
The move marks a significant step for a traditional financial institution into a part of cryptocurrency trading currently dominated by specialist digital assets firms.
Stablecoins are facing increasing attention from regulators, with the UK last month setting out proposals to bring the tokens into the real economy.
Stablecoins track sovereign currencies and make it easier for crypto traders to buy and sell in the market. The majority of trading in crypto such as bitcoin is done through stablecoins tied to the US dollar.
The $130 billion market is dominated by British Virgin Islands-registered Tether and the US’s Circle, which have faced questions over audits of the reserves that back their tokens.
Société Générale said EUR CoinVertible would be fully backed by euros.
“The crypto ecosystem is highly concentrated on a few existing stablecoins, 90% denominated in US dollars . . . we definitely think that there is a place for a bank in this field and there is a place for a euro [denominated] stablecoin,” comments Jean-Marc Stenger, chief executive of SocGen Forge.
While some large investment banks such as JPMorgan have their own stablecoins, they are only available to small groups of institutional clients. In contrast, Société Générale’s stablecoin will be widely available for trading.
Stenger said the bank hoped its stablecoin would be used to settle trades in digital bonds, funds and other assets as traditional financial institutions explore digital ledgers.
Mica, the EU’s flagship digital assets regulation, comes into force next year and Stenger said that Société Générale’s stablecoin is built to align with the rules, adding that “very few stablecoins are compliant with Mica”.
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