Euro stablecoin market poised to grow further due to real-world usage, regulatory clarity: Circle executive

According to Patrick Hansen, EU strategy and policy director at Circle, the future of euro-denominated stablecoins is bright. The United States dollar may retain its “first mover” advantage, but the euro stablecoin will have growing real-world use cases, lifting it above its current meager market share, Hansen said. Said At EthCC in Paris.

Euro-denominated tokens currently represent 0.3% of the stablecoin market and are valued at $300 million. Also, the Euro holds 20% of the traditional monetary system. In both cases it is second only to the US dollar and may remain in that position for some time. Hansen explained that the stablecoin market started with the dollar, and:

“Liquidity begets liquidity.”

With low liquidity in the market, Euro stablecoin users face higher risk and access costs.

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However, “we are currently moving from speculation to utility,” Hansen said of crypto capital markets as a whole. The growing use of stablecoins for remittances, business-to-business transactions and other matters reflects this, Hansen said, and users will want to use stablecoins in their local currency for these purposes. The integration of euro stablecoins into existing European payment systems will also boost its use.

Decentralized finance would operate in the same way, with real-world uses, such as car loans, delivered in local currency. He pointed out that this would lead to a greater regional liquidity pool.

What does a cup of coffee have to do with the future of the global economic order? As the US Congress prepares for its first vote on stablecoin legislation, US political leaders have a choice to make regarding the competitiveness of the US Dollar. Below is a video for political leaders. $USDC pic.twitter.com/9sQyZwq4WE

— Jeremy Allaire (@jeralaire) 13 July 2023

The passage of the Markets in Crypto-Assets (MICA) regulations will provide regulatory clarity in the EU. Hansen continued:

“I would also like to say about regulatory incentives.”

The euro-denominated stablecoin market is now dominated by five coins, including Circle’s Euro Coin (EUROC), which it introduced in June 2022. Circle has applied for a license in France to make EUROC a “fully compliant e-money token,” Hansen said.

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