Revolut is introducing a euro stablecoin into a market that MiCA has assigned to an American firm.

      Revolut is set to introduce a euro-backed stablecoin, entering a marketplace that European regulations have inadvertently unified around a single American issuer over the past two years. The neobank is also among the 36 companies selected by the ECB for its digital euro pilot, which means it is simultaneously developing its private euro token and assisting in the testing of the public alternative.

      The regulatory environment enhances the intrigue of this situation. MiCA mandates that significant stablecoin issuers must maintain at least 60% of their reserves in EU bank deposits, a rule aimed at ensuring that euro stablecoins remain tied to Europe. Tether opted out of authorization as its model relies on US Treasuries, leaving Circle’s USDC and EURC as the only stablecoins with e-money token authorization on the European regulator's register.

      Thus, the regulation meant to safeguard European monetary sovereignty inadvertently handed the European market to a US-regulated firm whose reserves are primarily linked to US Treasury instruments. The European Commission began consultations to address this in May, with a review report expected in mid-2027, and revised rules likely to emerge in 2028. This period presents an opportunity for Revolut. Earlier this year, Circle's EURC exceeded €400 million in circulation, a significant lead in a small market and only a modest achievement considering the potential of a euro stablecoin.

      Revolut has been acquiring the necessary licenses for this venture for eighteen months. It has obtained a full UK banking license in March, an EU banking license, a MiCA authorization through Cyprus, and is awaiting the outcome of a US bank charter application.

      These banking licenses are more critical than they seem. Having one allows Revolut to maintain reserves and issue a regulated instrument on its own balance sheet, rather than relying on third-party settlement infrastructure, providing a structural advantage over a crypto-native issuer. In February, the FCA chose Revolut as one of four firms from twenty applicants for its stablecoin regulatory sandbox, where it has been working on a pound-denominated token fully backed by sterling reserves.

      As this development progressed, the Bank of England has softened its stance by replacing proposed individual holding limits with a £40 billion issuance cap per systemic stablecoin and reducing the unremunerated central bank reserve requirement to 30%, permitting the remaining amount in short-term government debt.

      Moreover, Revolut is preparing for an IPO, having launched a private banking division while aiming for a $200 billion valuation. Having an issued currency instead of merely distributing another’s currency is an asset that supports such a high valuation.

      The commercial rationale is apparent in Revolut’s current crypto operations, rather than stemming from any broad monetary theory. The company reported $6 billion in revenue for 2025, an increase from $4 billion, with crypto wealth services growing by 298%, and has processed over $690 million through a Polygon integration for remittances.

      Additionally, with 65 million users across 38 countries, Revolut possesses an asset that no crypto issuer can replicate. In Europe, the limitation on stablecoin adoption has been distribution rather than technology, and a token appearing within an app that individuals already use for their salary starts from a more advantageous position.

      However, there is a conflict in pursuing this while participating in the ECB’s pilot. The central bank has expressed that the dominance of dollar stablecoins undermines its rate-setting capabilities, and a privately issued euro token does not seem to meet the remedy it envisioned, though Revolut appears to be banking on the success of both initiatives and aims to be involved with both.

      The precise details have not been independently verified. Information about the token’s name, the blockchain it will operate on, the location of its reserves, and the initial markets to receive it has yet to be established outside the original report, and those specifics will determine whether it competes with EURC or simply complements it.