The Canadian financial institution plans to launch a dollar-backed digital foreign money “within the coming months”.
In an announcement today, VersaBank said it was planning to launch a digital currency called VCAD, which is reported to be backed by Canadian dollars deposited with the bank.
The Canadian bank claimed that VCAD was effectively “the first digital currency to be a fiat currency” issued and supported by a North American bank. VersaBank announced that it has partnered with Canada Stablecorp, a joint venture between mutual fund manager 3iQ and blockchain company Mavennet, to bring the “stablecoin” to market.
The bank plans to make VCAD public “in the coming months” by issuing the digital currency to its “financial intermediary partners” in exchange for deposits in Canadian dollars. These partners can then reportedly offer VCAD directly to individuals and other companies.
Jean Desgagne, CEO of Stablecorp, said the digital currency was designed to address “two major flaws in the traditional cryptocurrency market”, namely volatility and security. The bank also plans to develop digital currencies issued by banks that are backed by the US dollar and the Euro VUS and VEuro respectively.
VersaBank is one of the few fully digital financial institutions – there are no stationary bank branches in which transactions can be carried out. In addition, the subsidiary has introduced a digital safe for storing crypto.
Although not backed by a bank, 3iQ and Mavennet have already introduced a regulated stable coin pegged to the Canadian dollar. Earlier this month, the companies launched an ERC-20 token called QCAD, which, according to Etherscan, already has more than 170,000 tokens in circulation at a price of $ 0.7854 – around $ 133,000.
In addition, VCAD is not the only CAD-bound stablecoin in the Canadian market. Coinsquare currently supports eCAD and TrustToken its TrueCAD token.