The issuance comes at a time when the European stablecoin market is poised for a shake-up as regulations for issuers will enter into full force by the end of this year.

As stablecoins gain traction, Netherlands-based fintech firm Quantoz aims to take a slice of the European market.

The company will issue the regulatory-compliant stablecoins pegged to the euro (EURQ) and U.S. dollar (USDQ) on the Ethereum blockchain. The tokens are fully backed by fiat reserves and highly-liquid financial instruments like government bonds, the firm said on Monday.

The firm has obtained the Electronic Money Institution (EMI) license from the Dutch Central Bank, a necessary requirement for stablecoin issuers to operate in the EU. Quantoz has secured investments from venture capital firm Fabric Ventures, crypto exchange Kraken and stablecoin behemoth Tether, though it didn’t disclose the size of the fundraising round.

EURQ and USDQ will first be listed on Bitfinex and Kraken and available for trading to eligible users starting Thursday.

Stablecoins, are tokens pegged to fiat currencies, have grown to a $180 billion asset class within cryptocurrencies and are a key piece of infrastructure for the digital asset market. They serve as liquidity to buy and sell crypto on exchanges, and are getting increasingly popular for everyday payments and remittances due to cheaper and faster settlements on blockchains compared to traditional banking rails.

Quantoz’s rollout comes at a time as crypto businesses in the EU are in crunch time before region-wide rules (MiCA) to operate within the trading bloc will enter into full force by the end of this year. MiCA requires stablecoin issuers to get compliant or potentially retreat from the market of 450 million consumers as regulated players such as exchanges delist unauthorized tokens. While Circle, the company behind the $36 billion market cap USDC, said that it fulfilled the requirements to operate in the region Tether has been a vocal critic of the new rules and is yet to obtain the necessary licensing.

“There’s a gap in the stablecoin market here in Europe, and we see that as an opportunity,” Arnoud Star Busmann, CEO of the firm’s payments-focused subsidiary Quantoz Payments, said in an interview with CoinDesk. “We are confident that our tech and regulatory compliance put us in a good position to fill that gap, especially now that we have strong partners like Kraken and Tether.”

Stablecoins can be impactful in areas where traditional banking infrastructure falls short, such as high-volume, low-value transactions, Busmann said. “Imagine being able to move cash in and out of money market funds without the traditional delays of.

Quantoz also has a tokenization business, a red-hot trend in crypto of creating digital versions of traditional financial instruments such as bonds. Tokenized assets combined with stablecoins can also offer a more efficient way for businesses and institutions to manage their treasury, thanks to their near-instantaneous settlement instead of one or two days of delay, he explained.

“We are building an ecosystem that can support a wide range of use cases, from everyday payments to more complex financial transactions,” Busmann said.

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Powell will start in her new role at the crypto exchange in November.

Crypto exchange Kraken has hired Natasha Powell as U.K. head of compliance, according to two people familiar with the matter.

Powell will be starting in November, said the people, who spoke on condition of anonymity because the matter is private.

“We’re always exploring new opportunities to enhance our offering with talent from the industry,” a Kraken spokesperson said in emailed comments.

Powell declined to comment.

Powell joins from crypto payments firm BCB Group, where she was employed as chief compliance officer.

She started her career with the Financial Conduct Authority (FCA), the U.K. regulator responsible for overseeing the financial services industry, and later held positions at RBS and Barclays Capital, according to her LinkedIn profile.

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The Judge ruled that Bit Trade Pty Ltd. issued its financial product to retail clients without having first made a target market determination for the product.

The Federal Court of Australia ruled on Friday that cryptocurrency exchange Kraken’s operator in the country, Bit Trade Pty Ltd, “contravened” with a section of the nation’s Corporations Act. The case against Bit Trade was brought by the Australian Securities and Investments Commission (ASIC).

Section 994B of the Corporations Act requires an issuer of a financial product to make a “target market determination” prior to the product being offered to consumers.

Justice Nicholas determined that “By issuing the Product to retail clients without having first made a target market determination for the Product, Bit Trade contravened s 994B(1) of the Corporations Act when read with s 994B(2).”

ASIC said “Since 5 October 2021, Bit Trade’s “margin extension” product has been available to customers trading on the Kraken exchange without a target market determination, as required by law.”

ASIC’s announcement also said that the Judge “found the obligation to repay a digital asset was not an obligation to repay money and was therefore not a deferred debt” but agreed with ASIC that “a margin extension in a national currency created a deferred debt which meant that the product was a credit facility.”

“Overall, we’re disappointed by today’s ruling, but we’re prepared and willing to comply with the court’s decision,” a Kraken spokesperson said in a statement sent via email. “We’re pleased the judge understood the nuances in this case, and recognised the challenges in applying existing regulatory frameworks to innovative technologies.”

Kraken’s legal spokesperson cited the judgment as an example of how “the law with respect to crypto offerings in Australia is not clear, adding that the “Court found that Kraken’s Margin offering is subject to a set of regulations called the Design and Distribution Obligations when we extended fiat currency to clients, but not when we extended cryptocurrency to clients.”

“This is an unsatisfactory position for Australian investors. While we prefer that to be through legislative reform rather than test cases, at least we now have clarity from the Court in respect of our Margin offering, and will move quickly to comply and continue to service our customers.”

ASIC said “the two parties have been given seven days to agree on declarations and injunctions” and that it would “seek financial penalties against Bit Trade.”

“This is a significant outcome for ASIC involving a major global crypto firm,” said Sarah Court, ASIC Deputy Chair. “We initiated proceedings to send a message to the crypto industry that we will continue to scrutinise products to ensure they comply with regulatory obligations in order to protect consumers.”

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The firm is looking move into a void in the crypto derivatives market left when FTX collapsed last November.

Crypto Facilities, which was bought by cryptocurrency exchange Kraken in 2019, is in talks with the U.K.’s Financial Conduct Authority about expanding its service to custody a broader range of client assets, Bloomberg reported on Thursday.

The London-based firm, which offers futures contracts in crypto assets for institutional investors, is in talks to offer futures contracts denominated in the fiat currency it is holding for the client, CEO Mark Jennings told Bloomberg.

This would require an expansion of its multilateral trading license, which it acquired in 2020. Jennings said he expects this process to take between six and 12 months.

“It’s a key driver as we expand out what we do in the institutional market across crypto,” Jennings said.

The firm is looking move into a void in the crypto derivatives market left when FTX collapsed last November.

“Prior to FTX we’d be hitting $700 million to $800 million a day” in trading volume, Jennings said. It is now closer to $100 million, he added.

The total volume in the crypto derivatives market fell to $1.62 trillion in August, a drop of over 12% from the month before and its second-lowest level since 2021, according to data provider CCData.

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