SG Forge Issues Euro Stablecoin
Posted by Colin Lambert. Last updated: April 21, 2023
Societe Generale Forge, a subsidiary of the French bank, has launched the EUR CoinVertible, a stablecoin deployed in Euro denomination on the Ethereum public blockchain.
The company says the project complements SG-Forge’s business offer to institutional clients seeking to benefit from innovative settlement and cash management solutions. It is designed to bridge the gap between traditional capital markets and the digital assets ecosystem based on the Cast1 open-source interoperability and securitisation framework.
It adds that while the regulatory framework related to digital assets at European level will be modified by the upcoming European digital assets regulations, MiCAR. and Pilot Regime, EUR CoinVertible, in accordance with the French legal framework, is applicable to digital assets has been designed to address growing client needs for a robust settlement asset for on-chain transactions.
It will also provide an innovative solution for corporate treasury, cash management and cash pooling activities, the company continues, as well as on-chain liquidity funding and refinancing solutions, and a solution for intra-day liquidity needs (e.g. margin calls).
EUR CoinVertible has a secure legal structure guaranteeing (i) the complete segregation of the collateral assets held to back the value of the stablecoins from the issuer, (ii) with a direct access given to token-holders on the collateral assets, and (iii) the implementation of business continuity plan mechanisms in case of a market or technological event, the firm says.
It also offers stringent and predefined collateral eligibility criteria (minimum rating, liquidity), daily transparency on EUR CoinVertible amount and collateral positions, as well as on the value and composition of the collateral, available on SG-Forge website. A request to assign a credit rating to the EUR CoinVertible has been made to an un-named independent credit rating agency, and access to EUR CoinVertible is limited to investors onboarded by Societe Generale group through its existing compliance procedures (KYC / AML-CFT, etc.). Interoperability and compatibility of the EUR CoinVertible with traditional systems and financial practices is available thanks to its implementation under the principles of the Cast framework, and publication of the source code of the EUR CoinVertible’s smart contract is available under the Apache 2.0 open source license.
“Digital assets with stabilisation mechanisms – i.e. stablecoins – built under a robust banking-grade structure will be a key element to increase trust and confidence in the native crypto ecosystem,” says Jean-Marc Stenger, CEO of SG-Forge. “This issuance is a major step in Societe Generale–Forge’s roadmap to deliver innovative solutions to its clients, either real-money institutions and corporates or entities of the crypto industry, and to facilitate the emergence of new market infrastructures based on blockchain technology.”