Germany Approves EURAU: First MiCA-Compliant Euro Stablecoin Gets Green Light from BaFin

02/07/2025 admin

Key Takeaways:

AllUnity secures EMI license from BaFin to issue Germany’s first fully regulated euro stablecoin.
EURAU will be 100% collateralized, MiCA-compliant, and offer institutional-grade transparency.
The stablecoin targets 24/7 cross-border settlement for financial institutions, fintechs, and enterprises.

Germany has officially entered the regulated stablecoin race. On July 1, 2025, AllUnity — a joint venture between DWS, Flow Traders, and Galaxy — received approval from Germany’s financial regulator BaFin to operate as an e-money institution (EMI). This license authorizes the issuance of EURAU, a euro-denominated stablecoin designed to meet the strict regulatory standards of the EU’s Markets in Crypto-Assets Regulation (MiCA) framework.

Germany’s First Fully Regulated Euro Stablecoin

BaFin’s approval positions EURAU as the first euro stablecoin in Germany fully authorized under MiCA, a pivotal regulation that came into full effect across the European Economic Area in mid-2024. The stablecoin will be issued by AllUnity, a purpose-built venture backed by heavyweight institutions from both traditional finance and the crypto sector.

Unlike many euro-pegged tokens circulating in unregulated markets, EURAU is 100% collateralized and subject to regulatory oversight, with ongoing proof-of-reserves disclosures and financial reporting.

According to AllUnity’s announcement, the stablecoin will be available for real-time, cross-border payments, and will integrate with financial institutions, corporate treasuries, and fintech platforms. Its design focuses on interoperability, regulatory trust, and institutional utility, making it a likely contender for widespread use across European digital finance.

What Is AllUnity?

A Joint Force of TradFi and Crypto Powerhouses

AllUnity brings together DWS Group, one of Europe’s largest asset managers (with over €1 trillion AUM), Flow Traders, a global market-making firm, and Galaxy, a U.S.-listed crypto-native company with a growing digital infrastructure portfolio.

The collaboration was established in late 2023 with a clear mission: to build compliant infrastructure for digital payments in Europe. With MiCA defining stablecoins as “e-money tokens” subject to rigorous scrutiny, securing an EMI license from BaFin was a necessary step for launching EURAU.

How EURAU Stands Out in the Stablecoin Landscape

The euro stablecoin sector has been growing slowly but steadily. While the U.S. dollar still dominates the global stablecoin market, the launch of MiCA has triggered a wave of euro-denominated tokens entering the market in 2024–2025.

Notable competitors include:

Circle’s EURC
Société Générale’s EURCV
Anchored tokens like Membrane Finance’s EUROe

What sets EURAU apart, however, is its German regulatory foundation, its institutional-grade collateralization model, and the backing of three global finance leaders.

The stablecoin is fully backed 1:1 with euro reserves, safeguarded in regulated financial institutions. This structure not only reduces counterparty risk but also meets the liquidity and audit standards required by MiCA.

Additionally, AllUnity’s partners bring strategic advantages:

DWS offers regulatory experience and asset custody depth.
Flow Traders ensures liquidity and trading infrastructure.
Galaxy provides crypto-native innovation, including integrations across DeFi and Web3 environments.

Who Will Use EURAU?

EURAU is primarily built for businesses, financial entities, and regulated fintechs, not for speculative retail activity.

Key use cases include:

24/7 cross-border settlements: Instant transactions beyond banking hours
Corporate treasury operations: Reducing friction in B2B and ERP payment cycles
Fintech rails: On/off ramps between fiat and crypto with Euro liquidity
Tokenization infrastructure: Enabling real-world assets (RWA) backed by stable euro flows
Bank integrations: EURAU may power backend rails for neobanks and payment platforms seeking programmable money with European regulatory clearance

With MiCA enforcement now active, stablecoins used for public-facing payments in the EU must meet specific regulatory requirements. EURAU is among the first to be positioned as a legally usable asset within that framework.

Industry Reaction and What Comes Next

Industry insiders view BaFin’s license approval as a landmark not just for AllUnity, but for the euro stablecoin ecosystem overall. For years, European regulators have approached digital currencies, especially stablecoins — which, it is often argued, are vehicles for financial instability or opacity — with caution.

That development implies a turn from regulators willing to back crypto assets that play along with the traditional financial regulation, especially when backed by institutional players.

Stefan Hoops, CEO of DWS, called the EMI license an “inflection point” for the region’s financial sector. “The euro on the blockchain isn’t just a technical milestone. It’s a strategic play for financial autonomy in Europe,” he stated.

Mike Kuehnel, CEO of Flow Traders, emphasized that stablecoins are “a foundational element” of the future financial infrastructure — particularly in creating interoperability between traditional and crypto markets.

Galaxy CEO Mike Novogratz also pointed to EURAU’s potential to drive compliant, transparent, cross-border value transfer at scale. “This is more than just a stablecoin — it’s the beginning of a regulated digital financial system for Europe,” he said.

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