AllUnity Secures BaFin License for Euro-Pegged Stablecoin EURAU

AllUnity, a joint venture between asset manager DWS and banking giant Deutsche Bank, has secured a license from the German Federal Financial Supervisory Authority (BaFin). This license, an E-Money Institution (EMI) license, allows AllUnity to issue a regulated and BaFin-licensed euro-pegged stablecoin, EURAU, in compliance with the Markets in Crypto-Assets Regulation (MiCA) framework.

EURAU will feature institutional-grade proof-of-reserves and financial reporting, ensuring transparency and reliability. The initiative, which also involves US-based Galaxy Digital, aims to provide euro-denominated digital assets that can be seamlessly integrated into the workflows of regulated institutions, fintech platforms, and enterprise treasuries. Amsterdam-based Flow Traders will serve as the project’s liquidity provider.

This development comes as Europe becomes a critical arena in the global stablecoin race, following the full implementation of MiCA on Dec. 30, 2024. The worldwide stablecoin market leader, Tether, has so far declined to comply with the MiCA framework, leading to USDt being delisted from major exchanges like Binance, Kraken, and Coinbase for users in the European Economic Area.

Earlier this week, Paxos announced the launch of its MiCA-compliant Global Dollar (USDG) stablecoin in the EU. Additionally, Circle’s MiCA-compliant stablecoin Euro Coin (EURC) has seen a rapid growth in its market cap. Circle’s stablecoins, including Euro Coin and USDC, have benefited from the implementation of MiCA, positioning them as the top euro and US dollar-pegged stablecoins that comply with the regulatory framework.

Despite the regulatory challenges, USDt remains the undisputed market leader with a significant lead over the second-largest stablecoin, USDC. The stablecoin landscape in Europe is evolving rapidly, with new players and regulatory compliance driving innovation and competition.