Two stablecoins EURQ and USDQ, pegged to the euro and the US dollar, launched on November 18 in Europe, are MiCA-compliant and backed by Tether, Kraken and Fabric Ventures.
The European crypto market has officially welcomed two new stablecoins, EURQ and USDQ, designed to comply with the European Union (EU) Markets in Cryptoassets (MiCA) Regulation. Launched on November 18, the two stablecoins are pegged to the euro and the US dollar at a 1:1 ratio, with reserves held entirely in fiat currency and subject to strict rules on additional reserves. The event marks an important step towards establishing a more regulated and transparent stablecoin market in Europe.
The creation of EURQ and USDQ is the result of a collaboration between Tether, Kraken, Fabric Ventures and Dutch fintech company Quantoz Payments. Quantoz Payments, the official issuer, has been licensed by the Dutch Central Bank (DNB) to operate as an electronic money token (EMT).
Cryptocurrency exchanges Kraken and Bitfinex are expected to list EURQ and USDQ on November 21, opening up access to qualified investors across Europe.
MiCA: A Key Legal Framework for Stablecoins
MiCA compliance is a key highlight of EURQ and USDQ. This regulatory framework requires stablecoin issuers to maintain a 1:1 fiat reserve and an additional 2% reserve, held by Quantoz. This is to ensure transparency, reduce risks in cryptocurrency payments, and strengthen user confidence in stablecoin issuers.
Anil Hansjee, managing partner at Fabric Ventures, commented that the launch of EURQ and USDQ sends a strong message about MiCA’s ability to facilitate stablecoin issuance in Europe.
The goal of EURQ and USDQ is to provide a secure and compliant digital payment solution within the European Economic Area (EEA). Backed by industry giants like Tether and Kraken, the two stablecoins promise to deliver faster, cheaper, and more transparent transactions for both businesses and consumers.
However, the implementation of MiCA has also been met with some concerns. Tether CEO Paolo Ardoino, while supportive of the launch of MiCA-compliant EURQ and USDQ, has previously expressed concerns about the potential for the framework to create “systemic risks” for the banking industry.
Specifically, MiCA requires stablecoin issuers to hold at least 60% of their reserves in European banks, which could become a problem if banks, which are allowed to lend up to 90% of their reserves, are exposed to financial risks or instability.
Despite this, MiCA has received support from a number of regulators. The Norwegian Central Bank (Norges Bank) appreciates MiCA's potential to support the issuance of a central bank digital currency (CBDC).
Norway, a member of the European Economic Area and subject to EU regulations such as MiCA, welcomes the framework, said Kjetil Watne, project manager at Norges Bank. However, the central bank is still considering whether additional regulation is needed to ensure financial stability.
Norway is also currently considering building a CBDC-based cross-border payment system.
