Deutsche Bank Backs EURAU Stablecoin Launch Under EU MiCA Regulations

Deutsche Bank-backed EURAU stablecoin launched on July 31, 2025, as the first euro-denominated digital currency compliant with the European Union’s Markets in Crypto-Assets Regulation (MiCA) [1]. Issued by AllUnity GmbH, a joint venture between DWS, Flow Traders, and Galaxy Digital, EURAU is fully collateralized by reserves held across multiple European banks and operates as an ERC-20 token on the Ethereum blockchain. The initiative is supervised by Germany’s Federal Financial Supervisory Authority (BaFin), emphasizing its regulatory robustness and alignment with EU standards [1].

The EURAU stablecoin aims to introduce a new asset class within Europe’s digital financial landscape, potentially transforming DeFi platforms that rely on euro-denominated assets. The stablecoin’s strategic partnerships with infrastructure providers such as BitGo, Fireblocks, and Bullish Europe are designed to ensure secure, scalable, and compliant operations. Bullish Europe, which has already listed EURAU for trading, is a key player in this ecosystem and plans to expand its presence across the EU under the new regulatory regime [1].

Despite being a regulatory breakthrough, euro-backed stablecoins remain a small portion of the global stablecoin market. As of July 31, 2025, euro stablecoins represented 0.2% of the $272.9 billion global stablecoin market, with a capitalization estimated between $484 million and $587 million. This pales in comparison to the $268.6 billion market cap of U.S. dollar stablecoins, with Tether’s USDT alone accounting for $163.7 billion. However, the value of euro stablecoins has increased by nearly 60% since December 2024, signaling growing interest in the asset class [1].

EURAU’s launch reflects broader European efforts to develop a competitive and balanced stablecoin ecosystem. Jürgen Schaaf, an adviser to the European Central Bank, has called for global regulatory coordination to counter the dominance of U.S. dollar-backed stablecoins. EURAU’s compliance with MiCA and its institutional backing position it as a potential catalyst for future innovation and adoption within the euro zone [1].

The stablecoin’s deployment on Ethereum highlights the ongoing preference for the network in stablecoin issuance. By being fully backed by major European financial institutions, EURAU aims to restore trust in stablecoins after past incidents of under-collateralization and governance failures. Deutsche Bank’s involvement underscores the increasing role of traditional financial institutions in the crypto space, potentially setting a precedent for broader participation in the regulated stablecoin market.

As MiCA continues to be implemented across the EU, EURAU will serve as a test case for the viability and adoption of regulated stablecoins. Its success could influence the broader acceptance of euro-backed stablecoins and reduce reliance on U.S. dollar-based alternatives in cross-border transactions and digital payments.

Source: [1] Deutsche Bank-backed EURAU stablecoin launch: Key things to know (https://cointelegraph.com/news/eurau-stablecoin-allunity-launch-key-things-to-know)