After its euro-backed stablecoin, EUR CoinVertible (EURCV), failed to gain significant traction despite being launched two years ago and aligning with the European Union’s Markets in Crypto-Assets (MiCA) regulations, Société Générale is now entering the market with a U.S. dollar-backed stablecoin.

The Introduction of EUR CoinVertible

EURCV was noteworthy as it represented the first time a regulated bank issued a euro-backed stablecoin, though its circulation remains limited to around $47 million.

NEXT STEPS FOR REGULATED BANKS

Jean-Marc Stenger, CEO of SG-Forge, Société Générale’s digital assets division, highlighted that a USD-backed stablecoin is the logical progression for the bank. USDCV, as it will be called, aims to launch this summer on both Ethereum and Solana blockchains.

Regulatory Landscape and Market Demand

The need for regulated offerings is crucial given the $250 billion market size of stablecoins. However, MiCA regulations have restricted some players from trading within the EU, particularly Tether, which is not licensed to operate in the region.

Circle, on the other hand, operates under MiCA and has established a presence with both euro- and dollar-backed stablecoins, but Société Générale sees an opportunity for USDCV. Stenger stated that at present, there are no banking-related players offering such a service in the EU market.

EU’s Perspective on USD Stablecoins

The launch of a U.S.-backed stablecoin from a major European bank like Société Générale has raised concerns about potential reliance on foreign currencies and companies. However, Société Générale is confident in the benefits USDCV can bring to crypto trading, cross-border payments, foreign exchange transactions, and cash management.

BNY Mellon will act as the custodian for USDCV’s assets. Despite the concern over foreign dependence, the bank believes that its extensive use cases outweigh these concerns.