Celo to Launch A Euro (cEUR) Pegged Stablecoin In March, Backed by Basket of Assets
Celo, a decentralized financial app, is adding a new stablecoin, backed by the Euro. The Euro stablecoin will be backed by a basket of cryptocurrencies that are algorithmically adjusted to maintain a stable price.
In a story first published by The Block, Celo, the mobile decentralized digital payments network, is launching a euro backed stablecoin. The Celo Euro is the second stablecoin to launch on the platform after the Celo Dollar (cUSD), which is pegged to the dollar.
According to Marek Olszewski, a partner at cLabs, one of the leading development firms on Celo, the stablecoin could launch at the end of Q1 2021, adding more DeFi qualities to its ecosystem.
The team has been working on the euro-pegged stablecoin for “a few months” since launching the Celo Dollar in June 2020. The stablecoin is a mobile-friendly innovation aiming to give the 5 billion+ smartphone users a safe, secure, and instant channel to transact cryptocurrencies worldwide.
Unlike Tether, who claims to back each stablecoin with a dollar its reserves, the Celo Euro stablecoin, in a similar fashion with the Celo Dollar, will be backed by a basket of cryptocurrencies, including Bitcoin and Ethereum. The cryptocurrencies will be algorithmically adjusted to ensure the stablecoin is pegged to 1 EUR at all times, Olsewski said in a statement. He added,
“We did a lot of work to show that having a diverse set of crypto assets is actually really good for stability.”
Since its mainnet went live in May last year, Celo has expanded its stablecoin developments to target the decentralized finance market – expanding its products from the Celo Gold (cGLD) to new “currency pegged stablecoins.”