European financial institutions are urgently working to introduce a widely available, onchain euro stablecoin to counter the growing risk of what CEO Jan-Oliver Sell calls “digital dollarization.” Sell, the CEO of the bank-backed consortium Qivalis, warned that a lack of liquid euro tokens on blockchains threatens Europe’s financial standing.

The Threat of Dollar Dominance Onchain

Major European banks are concerned that without a robust euro stablecoin, all blockchain-based financial activity will default to U.S. dollar-pegged tokens like USDT and USDC. This shift could undermine Europe’s financial and digital autonomy in the evolving digital economy.

Jan-Oliver Sell emphasized this critical juncture in an interview with CoinDesk. He stated, “If we don’t have a euro onchain with depth of liquidity, then the only alternative is the U.S. dollar.” This scenario poses a significant threat to Europe’s sovereignty.

The Euro's Disappearing Onchain Presence

In traditional finance, the euro holds its position as the world’s second reserve currency, accounting for 20% to 25% of global activity. However, this strength does not translate to the digital asset space.

Sell highlighted a stark contrast: “In the blockchain space, the euro makes up about 0.2% of transactions.” This massive discrepancy underscores the urgency for a native digital euro solution.

Qivalis: Europe's Answer to Dollar Stablecoins

Qivalis is a consortium involving 12 major EU banks, aiming to become the primary euro-denominated token on public blockchains. The project is seeking MiCA regulation and targets a launch in the second half of the year, pending approval from regulators like the Dutch central bank.

The consortium’s goal is to build the “default” euro stablecoin globally, positioning Qivalis as the essential interface between traditional euro systems and blockchain infrastructure. Sell noted that fragmented efforts by individual banks would only worsen the issue.

Complementing the Digital Euro

Qivalis is distinct from the European Central Bank’s (ECB) ongoing work on a potential digital euro, which is not expected before 2029. Sell clarified that Qivalis will issue a private, MiCA-regulated stablecoin.

He described a necessary “monetary stack” where centralized central bank money exists separately from the needs of public blockchain use cases, such as cross-border payments, which require a native asset on public networks.

Securing Financial Autonomy

The rapid shift of financial activity—from DeFi to global settlements—onto blockchain rails necessitates a usable euro asset. If European users are forced to earn yield in dollar-denominated assets, they face unnecessary foreign exchange (FX) risk.

Sell stressed that the objective is not to displace the dollar entirely but to ensure the euro maintains its competitive footing. “We’re looking to build a cornerstone of European digital autonomy. If we don’t have this, we will face dollarization,” he concluded.

The ultimate aim is to restore the euro’s status as the world’s second reserve currency within the digital asset ecosystem, thereby keeping Europe’s financial future within its own control.