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Spain Begins Euro-Backed Stablecoin Trials Under Bank of Spain's Oversight

Spain begins trials of EURM, a euro-backed stablecoin, supervised by the Bank of Spain, with the potential to revolutionize digital payments and transactions.

Spanish fintech firm Monei has initiated trials of EURM, a euro-backed stablecoin, under the regulatory supervision of the Bank of Spain. The official announcement, posted on Monei's website on January 29, revealed that these trials commenced in January, involving a select group of individual users to minimize errors.

The primary focus of the trial is to evaluate the transaction capabilities of EURM, a stablecoin backed 1:1 by the euro and held in Spanish banks, including BBVA and Caixabank. Users participating in the trial are required to verify their identities, upload a wallet, deposit 10 euros into their accounts, and exchange them for an equivalent amount of EURM.

Monei CEO Alex Saiz Verdaguer sees this trial as a significant step toward the complete digitization of payment methods. He anticipates that the stablecoin will offer a more secure, programmable, cost-effective, democratic, and liberalized approach to money transfer.

EURM is expected to facilitate near-instantaneous transactions between any two individuals with access to a mobile phone. Additionally, the transaction commission fee is slated to be minuscule, amounting to just "thousandths of a euro per transaction." The stablecoin's infrastructure also supports various corporate use cases, including real-time monthly or daily employee payments and productivity bonuses based on automated instructions.

The Bank of Spain initiated its wholesale central bank digital currency (CBDC) program in 2022. Verdaguer hinted at the possibility of EURM becoming the preferred technology of the Bank of Spain. In January 2024, the Bank of Spain announced separate testing in collaboration with Cecabank, Abanca, and Adhara Blockchain.

It is worth noting that the Spanish CBDC program differs from the digital euro project, as it is publicly stated to be independent and not tied to the digital euro, which would encompass all eurozone economies. Meanwhile, the Spanish Ministry of Economic Affairs and Digital Transformation announced its intention to implement the European Union's Markets in Crypto-Assets Regulation six months ahead of the deadline.

The trials of EURM and the broader developments in the Spanish digital currency landscape mark a significant step toward embracing innovative financial technologies in Spain.