Deutsche Bank subsidiary DWS, along with two partners, plans to launch a euro-backed digital currency, known as a stablecoin. The aim of this initiative is to accelerate the widespread adoption of digital assets based on blockchain technology, according to the three companies involved. The DWS, along with broker Flow Traders and blockchain specialist Galaxy, will establish a financial infrastructure provider named Allunity, which is set to launch in the first quarter of 2024 and will be headquartered in Frankfurt.
The new digital currency will be pegged to the euro and will target both institutional investors and retail investors. Allunity will initially apply for an e-money license from the German financial supervisory authority BaFin, and the issuance of the new digital currency is expected to take place within the next 12 to 18 months. Approval from BaFin as well as competition authorities is still required for the project to proceed. Previously, both French bank Societe Generale and payment service provider PayPal introduced their own stablecoins to the market.