Stablecoins have become a central pillar of the crypto sector. The fiat-pegged cryptocurrency market has seen a massive rise over the last few years. According to Reuters, 10 European Union banks, including ING, UniCredit, BNP Paribas, etc., have formed a company to launch a euro-pegged stablecoin, which will debut in H2 2026. The Amsterdam-based company will be named Qivalis and will be helmed by Jan-Oliver Sell. Sell was also the CEO of Coinbase’s German operations, and has also worked for Binance. Let’s discuss if a euro-pegged crypto will pose challenges to the US US dollar.

Will a Euro Stablecoin Challenge the US Dollar?

The is no denying the fact that the USD has lost substantial lustre over the last few years. Many countries have begun hedging against the dollar, while others are moving to alternative options. However, many expect the stablecoin era to bring back the dollar’s charm. A majority of the global stablecoins are pegged to the USD. The rise in stablecoin popularity has indirectly led to a rise in the dollar’s dominance within the crypto space.

The rise of a euro-pegged stablecoin could challenge the dollar-based stablecoin market. Moreover, the euro stablecoin is backed by some of the most renowned banks in the world. On the other hand, USD-pegged coins are not backed by big banks. Investors could get behind Qivalis’s upcoming euro-pegged coin, simply based on its backers.

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However, it would be wrong to question the US dollar’s global position. Dollar-pegged stablecoins continue to dominate the market and will likely continue to do so for the foreseeable future. Dollar-based stablecoins are also expected to bring more stability to the USD, while also countering the global exodus away from the greenback. According to Citi, the global stablecoin market may hit $1.9 trillion in its base case and $4.0 trillion in its bull case.