In a bid to capture a share of the European stablecoin market, Dutch fintech firm Quantoz is launching euro (EURQ) and US dollar (USDQ) stablecoins on the Ethereum blockchain that comply with the European Union’s landmark Markets in Crypto Assets (MiCA) regulation. This move comes at a pivotal time as the regional stablecoin market braces for disruption with MiCA rules set to fully take effect by year-end.
According to inside sources, Quantoz has secured the coveted Electronic Money Institution (EMI) license from the Dutch Central Bank, a prerequisite for stablecoin issuers operating in the EU. The company also counts crypto exchange Kraken and stablecoin giant Tether among its investors, although the funding round size remains undisclosed.
Quantoz’s Edge: Regulatory Compliance and Partnerships
Quantoz CEO Arno Star Busmann believes the firm is well-positioned to fill the void in the European stablecoin market, especially with the backing of strong partners like Kraken and Tether. “Here in Europe, there’s a gap in the stablecoin market, and we see it as an opportunity,” Busmann told CoinDesk.
The company’s stablecoins, EURQ and USDQ, will initially be listed on Bitfinex and Kraken exchanges, becoming available for trading to eligible users starting Thursday. The tokens are fully backed by fiat reserves and highly liquid financial instruments such as government bonds, instilling confidence in their stability.
Stablecoins: Enhancing Efficiency in Payments and Treasury Management
Busmann emphasized the potential of stablecoins to streamline areas where traditional banking infrastructure falls short, such as high-volume, low-cost transactions. “Imagine being able to move cash in and out of money market funds without the typical T+1 or T+2 day delays in traditional systems,” he explained.
Quantoz is also delving into tokenization, a burgeoning trend in crypto that involves creating digital versions of traditional financial instruments like bonds. When combined with stablecoins, tokenized assets can offer enterprises and institutions a more efficient way to manage their treasury, thanks to near-instant settlement versus the one to two-day lag in traditional systems.
“We’re building an ecosystem that can support a wide range of use cases: from everyday payments to more complex financial transactions,” Busmann said.
European Stablecoin Market at a Crossroads
Quantoz’s entry into the European stablecoin market comes at a critical juncture, with MiCA regulations poised to reshape the landscape. Stablecoin issuers must comply with the new rules or potentially exit the 450 million consumer market as regulated players like exchanges delist unauthorized tokens.
While Circle, the company behind the $36 billion market cap USDC, has stated it has met the requirements to operate in the region, Tether has openly criticized the new regulations and has yet to secure the necessary license. This uncertainty has created an opening for players like Quantoz to establish a foothold.
Looking Ahead: Stablecoin Adoption and Innovation
As stablecoins gain traction, with the asset class growing to $180 billion in cryptocurrencies, they are becoming an integral part of the digital asset market infrastructure. Beyond serving as liquidity for buying and selling crypto on exchanges, stablecoins are increasingly popular for everyday payments and remittances due to cheaper and faster settlement on blockchains compared to traditional banking rails.
Quantoz’s MiCA-compliant stablecoins, backed by major industry players, are poised to capitalize on this growing demand while navigating the evolving regulatory landscape in Europe. As the company builds out its ecosystem to support a range of use cases, from retail payments to complex financial transactions, it aims to play a key role in shaping the future of stablecoins and digital assets in the region.
With the European stablecoin market at a turning point, the success of players like Quantoz will hinge on their ability to balance innovation, regulatory compliance, and strategic partnerships. As the MiCA deadline looms, the coming months will be critical in determining the winners and losers in this dynamic space.
