France Backs Euro-Pegged Stablecoin to Challenge US Dollar Dominance

France is signaling a strategic push to diversify the stablecoin landscape, with Finance Minister Roland Lescure backing the Qivalis initiative. The project, which involves major financial institutions including ING and UniCredit, seeks to establish a euro-pegged stablecoin that adheres to the European Union's Markets in Crypto Assets (MiCA) regulatory framework. The move is a direct response to the overwhelming dominance of US dollar-backed assets in the digital asset space. Currently, the market is led by Tether (USDT), which holds a market capitalization of approximately $186 billion, and Circle (USDC). Lescure noted that the current volume of euro-pegged tokens is not satisfactory, urging banks to further explore tokenized deposits to modernize financial infrastructure. The Qivalis plan, originally launched in September 2025, is slated for a full rollout in the second half of 2026. This timeline aligns with projections from Banque de France Governor François Villeroy de Galhau, who suggested that tokenization and stablecoins would be pivotal to the financial sector by 2026. Despite the support for the infrastructure, a divide remains regarding the nature of these assets. Villeroy de Galhau has explicitly opposed interest-bearing stablecoins, citing potential systemic instability. This mirrors a broader regulatory stalemate in the United States, where the CLARITY Act remains stalled in the Senate due to disagreements over stablecoin yields and tokenized equities.