Société Générale Introduces First Major Bank-Issued Stablecoin

Société Générale launches EUR CoinVertible, a euro-backed stablecoin, on Bitstamp, pioneering digital currency in traditional banking.

What is a bank-issued stablecoin?

Société Générale, France's third-largest bank, has recently launched EUR CoinVertible, a stablecoin fully backed by euros, on Bitstamp, one of the longest-running crypto exchanges. This significant move marks the first instance of a major banking institution introducing a digital token tracking hard currency, signaling a pivotal shift in the intersection of traditional banking and cryptocurrency.

Société Générale
Société Générale has a market cap of around €19.14 Billion (Photo: Balint Porneczi)

Establishing New Ground In Cryptocurrency

The introduction of Société Générale's stablecoin is a key development in the financial sector, blending traditional banking principles with the burgeoning world of cryptocurrency. Stablecoins, which are digital tokens pegged to sovereign currencies, aid in streamlining cryptocurrency transactions. The launch of EUR CoinVertible breaks the norm in a market predominantly dominated by US dollar-tied stablecoins, with major players like Tether and Circle leading a market worth approximately $130 billion.

Unprecedented Accessibility In Stablecoin Markets

Setting itself apart from other financial institutions, Société Générale has made its stablecoin available to a broader audience, beyond the usual institutional clients. This wide availability is anticipated to facilitate the use of EUR CoinVertible in settling trades across various digital assets, including bonds and funds. This approach, as outlined by Jean-Marc Stenger, CEO of SocGen Forge, aims to establish a robust presence for a euro-denominated stablecoin in the crypto ecosystem.

Adherence To Regulatory Standards

In alignment with the upcoming MiCA regulations in the EU, Société Générale has ensured that its stablecoin adheres to stringent regulatory standards. This foresight positions EUR CoinVertible as a stablecoin that not only meets current regulatory expectations but also paves the way for future compliance. The regulatory environment, bolstered by the UK's recent approval for the tokenization of mainstream asset funds, further enhances the potential impact of SocGen's stablecoin in the financial market.

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Security And Flexibility Of The New Stablecoin

Société Générale has prioritized security in its stablecoin design, with the underlying euros held in a trust managed by a third party. This arrangement provides token holders with direct recourse to the collateral asset, mitigating exposure risks to the bank itself. Furthermore, the EUR CoinVertible is built for versatility, capable of operating across different platforms and financial services. This flexibility was recently demonstrated when Axa Investment Managers utilized the stablecoin for investing in a digital green bond.

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