European officials are increasingly concerned that the US government’s support for digital assets, particularly stablecoins tied to the dollar, could weaken the euro’s role and disrupt financial stability in the region.
Pierre Gramegna, managing director of the European Stability Mechanism (ESM), highlighted these concerns during a Eurogroup press conference on March 10. He noted that the US government’s stance on cryptocurrencies, especially dollar-backed stablecoins, raises challenges for Europe.
He warned that this shift could encourage major corporations to launch payment solutions based on these digital assets, which might threaten the eurozone’s control over its own financial system.
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Irish Finance Minister Paschal Donohoe also pointed out that policy changes in other countries can have serious effects on Europe. He linked the discussion to Europe’s financial security, stating that the euro must remain strong in the face of new global developments.
He believes introducing a digital euro is essential to maintaining control over Europe’s financial system and ensuring it is not overshadowed by external influences.
To counter these risks, European officials stress the importance of developing a digital euro. Gramegna emphasized that launching this central bank digital currency (CBDC) is more urgent than ever to protect Europe’s financial independence.
The ESM, an organization created by euro-area member states to support economic stability, backs the European Central Bank’s (ECB) efforts to accelerate the digital euro project.
Meanwhile, the ECB recently announced plans to modernize its payment infrastructure using blockchain technology. How would it achieve this? Read the full story.
Having completed a Master’s degree in Economics, Politics, and Cultures of the East Asia region, Aaron has written scientific papers analyzing the differences between Western and Collective forms of capitalism in the post-World War II era.
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