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Euro Stablecoin (EURB) on Stellar: Attack on Tether and Co?

Bank von der Heydt was the first European bank to issue a euro stablecoin. This will be used for cross-border payments and will be accessible mainly to banks and institutions. The EURB is 100% backed by euros and is not publicly tradable.Banks would not use a stablecoin like Tether or USDC. The counterparty risks are too high, as well as potential problems with regulators.

J. Frank Sigerson

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The German Bank von der Heydt (BVDH) has issued its own euro stablecoin based on the Stellar network.

Stellar wrote on Twitter: “We’re thrilled to announce that @Bitbond and Bankhaus von der Heydt are now issuing Euro Stablecoin (EURB), the first stablecoin issued directly by a banking institution on Stellar.”

The stablecoin goes by the acronym EURB and, according to the bank, is the first EUR stablecoin in the eurozone to be issued by a bank. According to the statement, the Digital Euro was created in collaboration with Bitbond and Stellar.

If you want to find more details about its features and why banks do not use well-known stablecoins like Tether (USDT), download for free the Born2Invest mobile app. Our companion app brings you the latest finance news so you can stay on top of the market.

Euro Stablecoin (EURB) based on Stellar

Officially, there is now a Digital Euro in the Eurozone, listed as Euro Stablecoin (EURB).

The issuer is the German bank von der Heydt. The EURB is fully regulated and backed 100% by euros. However, due to regulatory requirements as well as strict KYC requirements, the stablecoin cannot be traded publicly.

Customers have the following options to purchase the EURB:

A transfer of fiat money must be made to an escrow account at BVDH. Once the money lands from the secure escrow, the corresponding amount of EURB is sent to the customer.

However, concepts such as decentralization or privacy were not considered in the solution. The technical platform for processing EURB transactions was developed by Bitbond. Accordingly, the client, namely Bank von der Heydt, has complete control over elementary properties of the token. This includes all mechanisms around “burning and minting”.

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Cross-border payments with EURB

Bank von der Heydt is a German bank that has been around since 1754 and primarily serves institutional clients.

In this regard, there has been a collaboration with Stellar and Bitbond for more than a year. The goal of the collaboration is to explore potential applications based on DLT technology.

Philipp Doppelhammer represents BVDH in this regard and said that the Euro Stablecoin will primarily be used for cross-border payments. The bank’s motivation arose from the non-existence of a euro stablecoin actually issued by a “trusted” institution like a bank.

Banks would not use a stablecoin like Tether or USDC. The counterparty risks are too high, as well as potential problems with regulators. Both banks and institutional investors prefer trusted stablecoins.

Let’s note that Bank von der Heydt was the first European bank to issue a euro stablecoin. This will be used for cross-border payments and will be accessible mainly to banks and institutions. The EURB is 100% backed by euros and is not publicly tradable.

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(Featured image by Craig Cooper via Unsplash)

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J. Frank Sigerson is a business and financial journalist primarily covering crypto, cannabis, crowdfunding, technology, and marketing. He also writes about the movers and shakers in the stock market, especially in biotech, healthcare, mining, and blockchain. In the past, he has shared his thoughts on IT and design, social media, pop culture, food and wine, TV, film, and music. His works have been published in Investing.com, Equities.com, Seeking Alpha, Mogul, Small Cap Network, CNN, Technology.org, among others.