DWS to Launch Regulated Euro-Backed Stablecoin in 2025

DWS anticipates that there will be an initial surge in interest from crypto investors, which will be followed by a “broader demand”

Stefan Hoops, the CEO of asset manager DWS, disclosed to Reuters on July 11 that the company intends to introduce the first regulated euro-denominated stablecoin in 2025 through a new joint venture firm called AllUnity.

Hoops stated that the stablecoin will be subject to complete regulation by BaFin, Germany’s financial regulator. He also noted that the company anticipates that the stablecoin will generate initial demand from crypto investors and that interest in the token will increase over time among other segments.

This is according to Hoops:

“By the medium term we expect wider demand, for instance from industrial companies working with ‘internet of things’ continuous
payments.”

Additionally, he said that in June, DWS integrated AllUnity with Galaxy Digital and Flow Traders.

A euro stablecoin that is situated in Germany
The establishment of AllUnity represents a German-based endeavor to establish a euro stablecoin.

AllUnity, headquartered in Frankfurt, intends for its forthcoming stablecoin to be regulated by Germany’s Federal Financial Supervisory Authority (BaFin).

As Reuters noted, BaFin has not yet granted its e-money license regulation to any stablecoin. Consequently, DWS would be the first to receive sanction for such a product. The regulator has not yet responded to the issue.

The announcement is issued immediately after implementing EU-wide Markets in Crypto-Assets (MiCA) regulations regarding stablecoins on June 30. Data suggests that the new regulations have affected the stablecoin market value in Europe.

Only a few stablecoin issuers explicitly assert compliance: Circle declared that its USDC and EURC stablecoins are MiCA-compliant on July 1, designating itself as the first global stablecoin issuer to receive approval.

Deutsche Bank holds a majority stake in DWS, managing 941 billion euros ($1 trillion). It introduced crypto exchange-traded commodities (ETCs) in April.