The Bank of Spain has approved the launch of a pilot program for the issuance and use of euro-linked stable coins. The program, which is being launched by fintech entity MONEI, will allow users to issue digital euros with fiat deposits to try them on payment apps, increasing their transparency.
Bank of Spain authorizes euro digital token tests
Europe is becoming a hotspot for experimentation with stablecoins and CBDCs (central bank digital currency). On January 19, the Bank of Spain gave the green light to a pilot program to issue euro-linked digital tokens. The project, which is being led by MONEI, a regulated fintech payments company, will allow users to issue their own euro stablecoins for different purposes.
Using Ethereum and Polygon blockchain technology, the eurm token will be issued with user deposits and each token will be backed by real euros. The test, registered within the scope of actions in the financial Sandbox of the Sain bank, only allows the issuance of a maximum of ten euros for each user registered on the MONEI platform.
The test includes issuing up to 570 million euros because Spain has 57 million subscribed telephone lines. These funds will be held in two accounts at two financial institutions, BBVA and Caixabank, managed by MONEI.
Digital euro use cases
MONEI is shaping its digital stablecoin euro as part of its modernization of payments in the eurozone, increasing the speed of payments and reducing operational costs related to them. In this regard, MONEI CEO and Founder Alex Saiz Verdaguer stated:
The future of payments is digital. This is our chance to show the rest of Europe and the world that we are at the forefront. Eurm is the ultimate pan-European solution that will allow citizens and businesses across the continent to send and receive money instantly.
MONEI intends to have this stablecoin project approved by regulators after this test, to handle automatic and periodic payments that would benefit from programmable equivalent fiat currency. For example, a company can schedule payments to vendors based on sales made on a given day, or allow employees to schedule their daily, weekly, or monthly payments automatically.
This project is a private initiative and has no relation to the digital euro initiative led by the European Central Bank, which is still in the research phase to decide whether it will be issued.