A consortium of European banks is making significant strides towards launching a euro-pegged stablecoin, potentially by the second half of 2026. This initiative aims to provide a genuine European alternative to the U.S. dollar-dominated stablecoin market, bolstering Europe's strategic autonomy in the digital payment landscape.

The effort is spearheaded by a group of prominent financial institutions, including BNP Paribas, UniCredit, ING, Banca Sella, KBC, Danske Bank, DekaBank, SEB, CaixaBank, and Raiffeisen Bank International. These banks have established a company based in the Netherlands to manage the project and seek the necessary regulatory approvals. The consortium intends to apply for a license under the EU's Markets in Crypto-Assets (MiCA) regulation with the Dutch Central Bank.

The planned stablecoin is designed to maintain a stable value by pegging it to the euro. Stablecoins differ from more volatile cryptocurrencies like Bitcoin and Solana, offering price stability by linking their value to a fiat currency or commodity. The consortium emphasizes that the euro-backed stablecoin will facilitate near-instant, low-cost payments and settlements. It will also enable 24/7 cross-border transactions, programmable payments, and increased efficiency in areas like supply chain management and digital asset settlements.

The move towards a euro-pegged stablecoin comes as the market for stablecoins is largely dominated by those pegged to the U.S. dollar, such as Tether (USDT) and Circle's USDC. By comparison, the euro stablecoin market remains relatively small. As of late September 2025, the supply of USD-backed stablecoins reached $281.7 billion, while euro stablecoins on the Ethereum network totaled just €319.1 million.

The European Central Bank (ECB) has been monitoring the growth of stablecoins and acknowledges the potential risks to monetary policy as the stablecoin market expands. While the ECB considers the risks associated with stablecoins to be limited, it recognizes the need for close monitoring.

The launch of a successful euro stablecoin could have significant implications for the European financial sector. It could foster greater trust among businesses and consumers, paving the way for wider adoption of cryptocurrencies in everyday payments. A euro-backed stablecoin could also reduce Europe's reliance on American payment systems, offering a regulated alternative within the European Union.

While the consortium aims to launch the euro stablecoin in the second half of 2026, the timeline is subject to regulatory approval and the successful completion of the project. The initiative is viewed as a crucial step towards strengthening Europe's position in the evolving digital asset landscape.