BANCOMAT, Italy's domestic payment network, announced on 29 October that Hercle is joining EUR.BANK, its euro stablecoin project designed for the banking system. Hercle provides infrastructure for stablecoin treasury management and cross-border payments and holds crypto-asset service provider and e-money institution licences. Through the partnership, the stablecoin will be usable outside Europe as well, in a pilot for international payments. Nine major banks have already taken part in a pilot issuance, and the commercial launch will follow once authorisation is complete.

What it means: EUR.BANK is one of the initiatives through which European banks are trying not to leave the stablecoin market to dollar tokens and non-bank issuers. Today the vast majority of stablecoins are in dollars, something the ECB has described as a risk to the euro area's monetary sovereignty. A euro stablecoin issued by banks and built into the existing banking system could be used for business-to-business payments, settlement on blockchains and international transfers, with the trust that bank supervision brings. Hercle's participation adds access to global liquidity, which a stablecoin needs to be practically useful. The project sits alongside Qivalis, the consortium of European banks for a euro stablecoin, and the ECB's digital euro, which mainly targets retail payments. For Greek banks, how these initiatives develop will determine whether they join shared schemes or build their own. For businesses, a bank-issued euro stablecoin could cut the cost and time of cross-border payments, if it gains wide acceptance.

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