A Malta-based company Stasis has launched a new stablecoin called EURS. EURS is backed by the Euro and should trade on a one-for-one basis. The coin has been built on the Ethereum EIP-20 standard platform and has already begun trading on London-based exchange DSX already.
DSX predict the order volume to reach $500 million USD by year-end.
Stablecoins: EURS and Tether
Anyone familiar with Tether may scratch their beard dubiously at the EURS coin. But why?
Firstly, it is important to know that a stablecoin is the name given to a coin that is backed by an actual tangible asset, and in Tether’s case, its company claims that every tether coin on the market is backed by one US dollar — similar to Stasis’ claim about the EURS coin (except a different currency).
Every Tether is said to be tradeable on a one-for-one basis with the dollar. However, for months, controversy has surrounded this claim as it has never been legitimately proven. Also, the company’s terms and conditions state that “Tether reserves the right to refuse to issue or redeem Tether Tokens”, and some fear this give the company credence to not redeem the currency at the one-for-one value it claims.
Stasis will have to prove the true value of the EURS coin to gain market trust. There is no denying that stablecoins can bring more stability to the crypto world; providing an easier way for people to get in and out of a position and the demand for such an asset is certainly there. EURS will be effective on exchanges in lieu of fiat currency. In such a case, traders can trade their fiat for EURS and then enter an exchange with EURS, safe in the knowledge that the value of their currency will remain the same no matter the volatility of market prices. Not having to use fiat currency means that money can be moved between crypto exchanges without having to use wire transfers.
So in theory, anyone who holds EURS will have nothing to worry about because at any given time the tokens can be redeemed for real Euros.
Gregory Klumov, Stasis CEO stated: “EURS bridges the gap between traditional finance and the cryptoeconomy…While cryptocurrency trading is currently dominated by individual and retail investors, STASIS and EURS will pave the way for institutional investors to enter the game and begin allocating capital – that’s what’s needed to take the industry to surpass the trillion dollar mark.”
Stasis adds that EURS was specifically developed to satisfy growing demand for cryptocurrencies from European institutional investors.
Last week, Malta brought three new bills into law. Their purpose? To encourage cryptocurrency businesses to set up shop there. Stasis has announced it will obtain a license under this new regulatory framework.
Silvio Schembri, the Maltese Minister for Financial Services, Digital Economy and Innovation said on the matter:
“We therefore welcome any blockchain initiatives such as STASIS that while being innovative, will still respect and encourage compliance and we look forward to the company applying for a licence under our DLT regulatory framework.”
Featured Image: Deposit Photos/michaklootwijk