Circle announced Euro Coin, A new stablecoin pegged to the euro. And it is precisely the figure of the issuer - which already manages the popular USDC - to constitute the main business card of the project.
On the page of the initiative, we read that "Euro Coin (EUROC) is issued by Circle under the same full reserve model as USD Coin (USDC), a reliable digital dollar currency with over $ 54 billion in circulation". Initially, Euro Coin will exist on the blockchain di Ethereum, it will be a traditional ERC-20 already compatible with everything out there.
Euro Coin will be "100% backed by euros held in euro-denominated bank accounts, so that they are always redeemable 1: 1 in euros". The difference with normal euros is that EUROC will be "available 24/24, and moves at the speed of the internet". The new stablecoin debuts on June 30th. “Companies can mint Euro Coins directly from the source by depositing euros into their Circle Account using Silvergate's Euro SEN network”.
What is Euro Coin used for?
In a recent tweet, Circle CEO Jeremy Allaire summed up the product's value proposition. "Like the USDC, the Euro Coin is issued in a regulated framework for the transmission of money, according to the same statutes that regulate the USDC, with complete reserves in euros, with the same security, liquidity and transparency that the market wait from Circle".
Again, Circle promises a "Multicurrency digital banking is an almost instant foreign currency exchange, where daily volume in traditional markets can exceed $ 6.600 trillion globally".
"The seller does not want the currency in the possession of the buyer, and therefore the buyer must first buy another currency and bear the conversion costs. As advances in transportation and telecommunications continue to increase global economic integration, the cost of these inefficiencies continues to rise. The foreign exchange market, with a daily volume of $ 5.000 trillion, exists solely as a result of this inefficiency of the absence of a single globally homogeneous international currency.”- we still read.
The characteristics of the new Stablecoin
Where will the money be supporting the operation? "Circle will hold euros in euro-denominated bank accounts with major financial institutions, starting with Silvergate Bank in the US".
"Businesses can use a free Circle account to mint and redeem Euro Coins at no additional cost". Circle will control the Euro Coin. "Grant Thornton LLP will issue monthly certifications of Euro Coin reserves, starting with a certification for the month of July 2022. Circle will publish the attestation reports on this webpage, and the July report will be available online by the end of August 2022 ″.
It is also worth noting that the main criticism the project received was that it chose Ethereum to start. However, Circle promises that Euro Coin will soon be available in other blockchains. And considering that USDC exists in all smart contract-enabled blockchains, there's no reason not to believe it.