Deutsche Bank’s DWS Group, Flow Traders, and Galaxy Digital Holdings are joining forces to establish a new company called AllUnity, with plans to issue a euro-denominated stablecoin. This significant move in the stablecoin market is led by Alexander Höptner, the former CEO of BitMEX, and the consortium intends to apply for an e-money license from Germany’s financial regulator. The fully collateralized stablecoin is expected to launch within the next 18 months.
The purpose of this collaboration is to provide a stablecoin that caters to institutions, corporates, and private users, leveraging the collective influence and expertise of the participating firms in both traditional and crypto markets. DWS, as an asset manager overseeing a total of €860 billion, will bring trustworthiness to the venture, while Flow Traders, with €2.8 trillion worth of assets handled in the first half of the year, will contribute successful market-making capabilities. Galaxy Digital, a leading innovator in the crypto sector, will provide expertise in various crypto-related services.
This partnership aims to establish a stablecoin that possesses the necessary stability, trust, connection, and market power for it to be viable and usable. With major companies entering the stablecoin market, there has been a particular focus on euro-denominated tokens, as euro stablecoins have encountered limited demand thus far. On average, euro stablecoins have only recorded monthly trading volumes of $90 million, significantly lower than the $600 billion monthly average for USD-denominated stablecoins.
The introduction of guidelines for stablecoin issuers by the European Banking Authority (EBA) has created a favorable regulatory environment for ventures like AllUnity. The EBA’s recent release of stablecoin guidelines provides a framework that ensures stability and promotes transparency in this growing market. Additionally, the stablecoin market has expanded to a total value of approximately $130 billion, reflecting the increasing popularity and adoption of stablecoins.
The collaboration between Deutsche Bank’s DWS Group, Flow Traders, and Galaxy Digital Holdings to establish AllUnity and issue a euro-denominated stablecoin demonstrates the growing interest in stablecoins, particularly those denominated in euros. As institutions and corporates recognize the potential benefits of stablecoins, this initiative aims to provide a stable, reliable, and widely accepted digital asset in the euro market.