The stablecoin issuer said there was a risk of a “respective loss for the holders of AEUR tokens” due to FlowBank’s bankruptcy in June.
The bankruptcy of Flowbank could have repercussions for the Anchored Coins Euro (AEUR) stablecoin after the digital asset firm said it had “allocated a part of its reserve as collateral” to the Swiss bank.
In a notice published on its website, Anchored Coins said while the bank guarantee issued by FlowBank had not been terminated, collateral for AEUR was part of the bank estate “without any privilege.” The stablecoin issuer said it was coordinating with the bank to withdraw all funds connected to its collateral but would halt issuance and redemption of AEUR and ACHF — backed by the Swiss franc — “until further notice as ordered by the authorities.”
“As the bankruptcy proceedings concerning FlowBank SA in liquidation are still in an early phase, it is not yet clear to which extent this part of our collateral can be recovered,” said Anchored Coins. “Hence, a risk remains that in case of a shortfall, the 1:1 redeemability cannot be upheld which would lead to a respective loss for the holders of AEUR tokens.”
