A consortium of 12 major European banks is racing to launch a euro-backed stablecoin, Qivalis, in response to the growing dominance of dollar-pegged tokens in the blockchain space. The initiative aims to establish a deep, liquid euro stablecoin to prevent financial activities on blockchains from defaulting to U.S. dollar-based assets, which pose a risk to Europe’s financial sovereignty. Qivalis is expected to launch in the latter half of the year, pending regulatory approval, and will complement the European Central Bank’s digital euro initiative.

The significance of this development lies in the current market landscape, where euro transactions account for only 0.2% of blockchain activity, despite the euro being the world’s second reserve currency. With stablecoins now integral to global finance, projected to grow from $314 billion to up to $1.15 trillion in the next five years, Qivalis seeks to create a robust euro presence on public blockchains, enhancing liquidity and usability.

For market professionals, the emergence of Qivalis underscores the urgent need for a competitive euro stablecoin to mitigate risks associated with dollar dependency in the evolving digital finance landscape. This initiative may reshape trading strategies and investment considerations as the euro seeks to reclaim its position in the onchain economy.

Source: coindesk.com