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One of Germany’s oldest banks said it was choosing the Stellar network to issue a Euro-backed stablecoin, in one of the first such instances.

As per an official announcement on Wednesday, Bankhaus von der Heydt (BDNH) said it would launch the EURB stablecoin on the Stellar network this week. The development is a result of a partnership between itself and Bitbond, a German startup that tokenizes real-world assets and provides crypto custody services.

We're thrilled to announce that @Bitbond and Bankhaus von der Heydt are now issuing Euro Stablecoin (EURB), the first stablecoin issued directly by a banking institution on Stellar.

Learn more about Bitbond, Bankhaus von der Heydt, and EURB here:https://t.co/zl4cfa7eH5

— Stellar (@StellarOrg) December 9, 2020

Stablecoins are a type of regulated, unregulated, or algorithmic cryptocurrency backed on a 1:1 basis with any given fiat currency. They together account for billions of dollars in volume each day in the crypto market and are used for trading, cross-border transfers, DeFi yields, and arbitrage, among other purposes.

The EURB stablecoin is the first stablecoin issued directly by a banking institution on Stellar and one of the first of its kind in the crypto market, the release claimed. It added the Stellar Development Foundation, the nonprofit organization supporting the development and growth of Stellar, both consulted with Bitbond and took part in the development of EURB,

BVDH, which has been in operation since 1754, has historically focused on serving institutional clients in securitization-related transactions. It has since explored blockchain technology and cryptocurrencies to make its securitization business more efficient, partnering with Bitbond for the purpose.

After its launch today, both BVDH clients and third-party developers of financial applications can choose the EURB to settle digital asset transfers on-chain, making it yet another option alongside current products like USDC and Tether.

Denelle Dixon, CEO and Executive Director of the Stellar Development Foundation, said the move was a testament to the ways that traditional banking and blockchain can work together, bringing together one of the oldest banks in Europe with a FinTech start-up to deliver exciting innovation in the digital currency space.

She added:

“A high-quality, bank-issued euro asset to Stellar is meaningful for our users and builders on our network, powering a new wave of financial innovation, leveraged immediately by Stellar-based apps.”

So is the burgeoning DeFi market coming to the EURB ecosystem anytime soon? Perhaps. The release suggested that BVDH can now fully create “new opportunities” with banking clients who want to issue “tokenized financial assets with a full on-chain settlement,” opening the doors to widespread adoption and use cases.

Wait until the TradFi finds out the yields in DeFi.

The post German legacy bank turns to Stellar (XLM) to issue Euro stablecoin appeared first on CryptoSlate.

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