Nine European banks to launch euro stablecoin by 2026

Nine major European banks announced yesterday they will launch a euro-backed stablecoin by 2026, marking a significant push by traditional financial institutions to challenge the US dollar's dominance in the digital payments landscape. The consortium, led by UniCredit and ING, aims to provide European businesses and consumers with a regulated alternative to existing dollar-denominated digital currencies.

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The initiative represents Europe's most ambitious attempt to establish financial sovereignty in the rapidly growing stablecoin market, where US dollar-pegged tokens currently control 99% of the $200 billion sector. The timing is strategic, as Europe's own central bank digital currency won't launch until mid-2029 at the earliest.

Banking Giants Unite for Digital Euro Push

The nine-bank consortium includes UniCredit, ING, Banca Sella, KBC, Danske Bank, DekaBank, SEB, CaixaBank, and Raiffeisen Bank International. The new company will be headquartered in the Netherlands and supervised by the Dutch Central Bank as an e-money institution.

"Digital payments are key for new euro-denominated payments and financial market infrastructure," said Floris Lugt, ING's digital assets lead and joint public representative of the initiative. The stablecoin will enable 24/7 cross-border payments, programmable transactions, and improved supply chain management while maintaining compliance with the EU's Markets in Crypto-Assets (MiCA) regulation.

The consortium remains open to additional banks joining the initiative and expects to appoint a CEO soon, subject to regulatory approval. Individual banks will be able to provide value-added services such as stablecoin wallets and custody solutions.

Strategic Response to Dollar Dominance

The move comes as European policymakers express growing concern about the region's dependence on US dollar-based financial infrastructure. Euro-denominated stablecoins currently represent just 0.2% of the global stablecoin market, valued at approximately €500 million compared to over $200 billion for dollar-pegged alternatives.

"We are contributing to fill the need for a trusted, regulated solution for on-chain payments and settlement, paving the way for a new standard in the digital asset space that will support Europe's growth and financial sovereignty," said UniCredit head of strategy Fiona Melrose. The initiative positions itself as providing "a real European alternative to the US-dominated stablecoin market," according to the banks' joint statement.