Societe Generale New Euro Stablecoin Raising Doubts In The Community

Key Points:

• Societe Generale announced the introduction of EUR CoinVertible (EURCV), a euro-pegged stablecoin.
• Researchers who examined the stablecoin’s smart contract code revealed that ERC-20 transactions need authorization from an in-house registrant before being carried out.

Societe Generale announced this week the launch of the euro-pegged stablecoin EUR CoinVertible (EURCV), an Ethereum-based stablecoin available only to authorized institutional clients.

However, according to smart contract engineer alephv.eth on social media, the ERC-20 transfer of the stable currency needs to be authorized by the internal registrar before the transaction is executed.

alephv.eth added that Societe Generale coded the EURCV stablecoin and had to whitelist all users before processing “transferFrom,” and even approved user ERC20 transfer transactions.

And some suspicions have also been pointed out that some of the people who went to shill for the project are actually still unidentified.

Via specific capabilities of the bank’s smart contract, software developer Cygaar revealed that the bank may seize and burn all of its customers’ money.

SG would be much better off utilizing Onyx (JPM’s internal system) or an internal database because they’re aiming for a centralized settlement layer, Cygaar noted.

Another developer, 0xfoobar, pointed out that the coding demands that each and every ERC-20 transfer be authorized by the centralized registrar in a separate ETH transaction before it can be performed.

Others have expressed concern about the coin’s security and its potential impact on the wider cryptocurrency market as a result of these statements.

On April 20, the French bank Societe Generale-Forge (SGF) announced the launch of EUR CoinVertible (EURCV), an Ethereum-based stablecoin available exclusively to approved institutional customers.

Societe Generale would only make EURCV accessible to investors it has recruited via its existing Know Your Customer (KYC) and Anti-Money Laundering (AML) practices.

Although some argue that centralization is necessary for legal compliance and monetary stability, others argue that it is incompatible with blockchain technology’s decentralized ethos.

Given that the coin is issued by Societe Generale-Forge, the bank’s cryptocurrency division, and that most banks are all about control and centralization, it’s possible that this new euro-pegged stablecoin is just another attempt by traditional financial institutions to limit how people use their money.

If so, then this is just a cover to control money flow in the name of the bank’s decentralization, something that no one wants.

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Harold

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