Société Générale is set to launch its own stablecoin on a cryptocurrency exchange, becoming the first big bank to offer digital tokens tracking the price of hard currencies to a wide range of investors.
The $130bn market is dominated by British Virgin Islands-registered Tether and the US’s Circle, which have faced questions over audits of the reserves that back their tokens. SocGen said EUR CoinVertible would be fully backed by euros.
“The crypto ecosystem is highly concentrated on a few existing stablecoins, 90 per cent denominated in US dollars . . . we definitely think that there is a place for a bank in this field and there is a place for a euro [denominated] stablecoin,” Jean-Marc Stenger, chief executive of SocGen Forge, the bank’s digital assets unit, told the Financial Times.
While some large investment banks such as JPMorgan have their own stablecoins, they are only available to small groups of institutional clients. In contrast, SocGen’s stablecoin will be widely available for trading.
Stenger said the bank hoped its stablecoin would be used to settle trades in digital bonds, funds and other assets as traditional financial institutions explore digital ledgers.
“The best way to channel [investors’] interest is to grow in the usual route and venue which you use in the crypto industry, which is to have your product listed on a crypto exchange,” he said.
On Monday, Axa Investment Managers invested in a digital green bond using SocGen’s stablecoin.
Stenger said that the stablecoin had been built to be able to be used on different platforms and between various financial services players.
He added that token holders would face no exposure risk to the French bank itself, and have “direct recourse on the collateral asset of the stablecoin”, as the euros would be held in a trust managed by a third party.
“It’s open to anyone who wants to use it, either operations on our own platform or other platforms,” he added.
source : https://archive.is/B667Y#selection-1575.0-1575.62