10 EU Banks Join Forces! Euro Stablecoin to Launch in 2026, Challenging US Dollar Dominance

A consortium of 10 banks plans to launch a euro-pegged stablecoin through an entity authorized by the Dutch central bank in 2026. BNP Paribas announced on Tuesday that it will collaborate with nine other EU banks to launch a euro-backed stablecoin “in the second half of 2026.” Currently, the market capitalization of euro-denominated stablecoins is less than €350 million (about $407 million), accounting for just 1% of the global market, with USD stablecoins continuing to dominate.

Qivalis Alliance’s Ambition for a Euro Stablecoin

(Source: KBC)

BNP Paribas’s announcement on Tuesday marks a significant strategic move by the EU banking sector in the digital asset space. One of Europe’s largest banks, BNP Paribas will collaborate with nine other EU banks to launch a euro stablecoin through Qivalis, an Amsterdam-based entity. Jan-Oliver Sell, CEO of Qivalis, stated: “A native euro stablecoin is not just about convenience; it’s about monetary sovereignty in the digital age. It will bring new opportunities for European businesses and consumers, allowing them to engage in on-chain payments and the digital asset market in their domestic currency.”

The term “monetary sovereignty” reveals the deeper motivation behind this initiative. The global stablecoin market is currently dominated by USD-denominated tokens, with Tether’s USDT and Circle’s USDC accounting for over 90% of the market share. This dollar hegemony is not only reflected in the traditional financial system but has also extended into the digital asset realm. For the EU, launching a native euro stablecoin is not just a commercial opportunity but a strategic move for financial sovereignty.

The composition of the Qivalis alliance is noteworthy. Although the announcement only mentioned BNP Paribas, the joint action of 10 banks demonstrates a cross-border, multi-institutional coordinated effort. This banking consortium model is relatively rare in the stablecoin space, where most mainstream issuers are tech companies or crypto-native firms. Bank-led stablecoin issuance may bring greater regulatory compliance and the trust of the traditional financial system.

Key Features of the Qivalis Stablecoin

Launch Date: Planned for the second half of 2026, pending approval from the Dutch central bank

Regulatory Framework: Fully compliant with EU MiCA (Markets in Crypto-Assets) regulations

Issuing Entity: Consortium entity formed by 10 EU banks, headquartered in Amsterdam

Target Market: European businesses and consumers, focusing on on-chain payments and the digital asset market

Choosing the Netherlands as the place of registration is no coincidence. The country is relatively open to fintech and crypto regulation, and Amsterdam is one of Europe’s major financial centers. The Dutch central bank has accumulated experience in digital asset regulation, providing a relatively friendly environment for Qivalis’s regulatory application.

The Regulatory Race: MiCA Framework vs. US GENIUS Act

As US regulators prepare to implement legislation to establish a US payment stablecoin framework, the move to launch a major euro-pegged stablecoin comes at a crucial time. The so-called “GENIUS Act” was signed into law by President Trump in July. The simultaneous advancement of such regulatory frameworks reflects the competitive dynamics among the world’s major economies regarding stablecoin regulation.

The EU’s MiCA (Markets in Crypto-Assets) regulation was passed in 2023 and began phased implementation in 2024. It is the world’s first comprehensive crypto-asset regulatory framework, setting strict capital requirements, transparency standards, and consumer protection measures for stablecoin issuers. MiCA requires issuers to hold sufficient high-quality reserve assets and undergo regular audits, a regulatory approach seen as a sign of the stablecoin industry’s maturation.

The US GENIUS Act takes a different path. It focuses on payment stablecoins, requiring issuers to be licensed at the federal or state level and to maintain 1:1 reserve backing. Compared to MiCA’s comprehensive regulation, the GENIUS Act is more focused on payment use cases and gives issuers greater flexibility. These regulatory differences may lead to distinct development paths for the stablecoin markets in Europe and the US.

For Qivalis, the MiCA framework presents both a challenge and an opportunity. On one hand, strict compliance requirements increase operating costs and entry barriers; on the other, MiCA-compliant stablecoins will receive a “passport” to circulate throughout the EU, an advantage the US regulatory framework cannot offer. If Qivalis secures approval from the Dutch central bank, its stablecoin could, in theory, be used in all EU member states, covering a market of roughly 450 million people.

The Awkward State and Breakthrough Challenges of Euro Stablecoins

According to European Central Bank advisor Jürgen Schaaf, as of press time, the market capitalization of euro-denominated stablecoins is less than €350 million (about $407 million), accounting for under 1% of the global market as of July. This figure stands in stark contrast to the scale of USD stablecoins. Tether’s USDT has a market cap exceeding $140 billion, and Circle’s USDC about $35 billion, together capturing over 90% of the global stablecoin market.

This huge gap reflects multiple structural factors. First, the US dollar, as the global reserve currency and the main settlement currency for international trade, has naturally broader demand. Second, early stablecoin projects almost all chose the dollar as their peg, creating strong network effects and liquidity advantages. Third, USD stablecoins serve as the base trading pair on crypto exchanges, a foundational role that is hard to challenge.

Another challenge facing euro stablecoins is fragmentation. Before Qivalis, Europe already had several euro stablecoin projects, but all were small and uncoordinated. This fragmentation disperses liquidity and prevents the formation of sufficient market depth. The Qivalis 10-bank consortium model aims to address this, integrating resources and coordinating promotion to build a euro stablecoin with scale effects.

As EU banks seek to develop the stablecoin market, Dutch central bank president Klaas Knot reportedly warned that stablecoin market growth could pose potential risks to monetary policy. In a November report, the ECB stated that stablecoin-related risks may be limited but “their rapid growth warrants close monitoring.” This caution reflects central banks’ concerns that privately issued digital currencies could undermine monetary policy transmission mechanisms.

The Market Vacuum Left by Tether’s Exit

Stablecoin issuer Tether stopped redemptions for its euro-pegged token EURt on November 25, after announcing about a year earlier that it would end support for the token. The company cited the EU’s MiCA regulation, with CEO Paolo Ardoino claiming the rules pose risks to stablecoins.

Tether’s exit is no accident. MiCA imposes strict transparency requirements on stablecoin issuers, including regular audits, reserve asset disclosures, and corporate governance standards. Tether has long faced criticism over reserve asset transparency, and while its disclosures have improved in recent years, the company apparently sees MiCA’s requirements as too stringent. Ardoino has publicly criticized MiCA as an “existential risk” to stablecoins, suggesting compliance costs and operational restrictions could make the business unviable.

Tether’s withdrawal leaves a vacuum in the European market. While EURt was not large in scale, as part of the Tether ecosystem, it still had a user base and liquidity. This vacuum offers an opportunity for Qivalis and other MiCA-compliant euro stablecoin projects. More importantly, Tether’s exit sends a clear signal to the market: the EU is determined to build its own stablecoin ecosystem rather than rely on US-dominated players.

A Turning Point for the Euro Stablecoin Market

Tether EURt Exit: Redemptions end in November 2024, market leader withdraws

Full MiCA Implementation: Phased rollout 2024–2025, reshaping competition

Bank Consortia Enter: Institutional players like Qivalis fill the vacuum

Regulatory Clarity: Clear compliance paths reduce uncertainty

In the long term, Tether’s exit may be seen as the beginning of the euro stablecoin market’s maturation. In the past, the market was dominated by gray-area, unregulated projects; in the future, it will be led by institutional players meeting strict regulatory standards. While this shift sacrifices some ideals of “decentralization,” it could pave the way for mainstream adoption.

If Qivalis successfully launches in 2026 and gains market acceptance, it could trigger a chain reaction in the European banking sector. More banks may join the stablecoin issuance race or partner with Qivalis, achieving scale effects. This bank-led stablecoin ecosystem, combined with the EU’s single market and unified regulation, has the potential to carve out a euro-denominated territory in the global stablecoin landscape.