Deutsche Bank subsidiary DWS and Galaxy working on euro stablecoin

Together with Galaxy and Flow Traders, DWS is working on the company AllUnity. The goal is to issue euro stablecoin within 12 to 18 months.

The fund house of Deutsche Bank, plans to create AllUnity in partnership with Flow Traders and Galaxy, Mike Novogratz's investment company. The goal is to create a fully collateralized stablecoin in euro to launch token economy.

AllUnity also wants to accelerate the market introduction of digital assets and tokenization, according to a press release. In addition, the company combines the portfolio management and product structuring capabilities of DWS, the liquidity provision and asset connectivity expertise of Flow Traders and the technical infrastructure and solutions experience of Galaxy.

AllUnity aims to position itself as a leading regulated provider of stablecoin in euro for institutional, corporate and retail investors. Stablecoin will be physically backed by euro-denominated fiat money and euro-denominated high-quality liquid assets, such as German government bonds.

"Until now, dollar-denominated stablecoins have been the first players in the market and have benefited from network effects accordingly," a DWS spokesperson explained to BTC-ECHO. "In addition, negative interest rates in the eurozone have made physically covered stablecoin less commercially attractive in the past. We believe recent developments in the eurozone, such as MiCA, have led to increasing interest in euro-denominated stablecoins," the statement continued.

Euro stablecoin: MiCA and BaFin-compliant

The trio of companies must have been waiting for the perfect moment: Thanks to the MiCA Regulation digital assets are clearly regulated in the EU. Regulations passed by Parliament in April provide a "harmonized legal framework for stablecoins to strengthen investor protection and market integrity," according to the statement.

AllUnity plans to issue euro stablecoin within the next 12 to 18 months. This should be possible with the help of an e-money license from BaFin. However, the establishment of AllUnity is still subject to several conditions, including approval from BaFin and competition authorities, according to the statement. The stablecoin companies Circle and Tether thus face competition from the financial sector.

Alexander Höptner as AllUnity CEO

With Alexander Höptner, DWS, Galaxy and Flow Traders are bringing on board a well-known personality from the financial sector. Höptner emphasizes the uniqueness of the partnership and the opportunities it will bring. "In the coming period, we will focus on building a strong team of talented crypto, financial market, technology and regulatory experts to fulfill our mission," explains the ex-Bitmex CEO.

With AllUnity, DWS CEO Stefan Hoops wants to "bridge the gap between the traditional and digital financial ecosystem and enable secure on-chain settlement." Mike Novogratz, CEO of Galaxy, sees the partnership as an opportunity to introduce an open, interoperable stablecoin in euro and the massive adoption of stablecoins.