Lugh is the first French startup to launch a new Euro stablecoin that is backed by deposits held by french bank Société Générale. The recent announcement by Lugh describes the release and nature of the EUR-L tokens.
The digital asset EUR-L is backed by Fiat Euros on a Societe Generale bank account and is currently available on the French cryptocurrency exchange Coinhouse, with plans to leverage it on other blockchain platforms in the future.
The Euro pegged EUR-L token has involvement from a number of figures, including SCEME, developer of the emission and management platform of Lugh, Nomadic Labs, and Casino Group. EUR-L is issued on the Tezos blockchain, and Lugh reports that users will be able to access monthly reports regarding their reserves, validated by a global accounting firm.
Lugh announced that the digital asset had been presented to the french regulatory authorities and is able to comply with the current regulatory framework.
Over the past year France has been working towards implementing regulation for the licensing of digital asset service providers. French financial markets regulator, the Autorité des Marchés Financiers (AMF), set forth a series of rules for DASPs in January 2020 that followed the EU anti-money-laundering directive that EU members are required to follow.
Other Euro-backed stablecoins are currently in circulation, with Austrian Raiffeisen Bank releasing its RBI Coin in a partnership with Billon, and one of the oldest banks in Europe Bankhaus von der Heydt, announced a collaboration with Stellar to release its EURB stablecoin.
Not all cryptocurrencies are viewed equally, however, and many european countries follow different approaches to regulating cryptocurrencies. While cryptocurrencies such as Bitcoin and Ethereum are popular among the general population, stablecoins are viewed with less distrust by national governments, due in part to the stability that they imply.
Nonetheless, European countries that share the same Fiat currency are no closer to finding a collective solution to the regulation of cryptocurrencies. And the U.K approach will necessitate a close collaborative effort with E.U. members, despite having left the community.
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.