- An European Central Bank adviser said a central bank digital currency (CBDC) alone will not offset the dominance of U.S. dollar-backed stablecoins.
- The EU is considering supporting regulated euro-pegged stablecoins and distributed ledger technology (DLT) as additional measures.
- The digital euro, though seen as important, is only one part of the EU’s wider digital payments strategy.
- The ECB recently approved two DLT pilot projects to strengthen Europe’s payment infrastructure.
- A decision on whether to proceed with the digital euro will be made by the end of 2025.
An adviser to the European Central Bank (ECB) stated that a central bank digital currency will not be sufficient by itself to compete with the growing use of U.S. dollar-denominated stablecoins. The comments appeared in a blog post published on Monday on the ECB’s official website.
Jürgen Schaaf, the adviser, outlined various approaches for the European Union to respond to the increase in dollar-based stablecoins. He identified the support of properly regulated euro-backed stablecoins, broader use of distributed ledger technology (DLT), and the ongoing development of the digital euro as possible strategies.
Schaaf stressed the need for international coordination on stablecoin regulations. He highlighted the differences between U.S. rules, including the GENIUS Act, and the EU’s own MiCA regulation. Schaaf wrote, “Euro-based stablecoins, if designed to high standards and effective risk mitigation, could serve legitimate market needs. They could also reinforce the international role of the euro.” However, he also pointed out that adoption of euro-based stablecoins has been slow, with only limited circulation despite regulatory frameworks like MiCA meant to support them.
The blog post noted that the digital euro project remains under consideration. According to Schaaf, the digital euro is just one aspect of the EU’s digital payment strategy, which includes public and private sector initiatives and the use of DLT for more effective domestic and cross-border payments. In early July, the ECB approved two DLT pilot projects, Pontes and Appia, designed to improve Europe’s payment systems. Additional information on these pilots can be viewed in the ECB announcement.
Concerns in Europe about the U.S. lead in digital finance followed an executive order from President Donald Trump in January supporting stablecoin development. The ECB began the “preparation phase” for the digital euro in November 2023. The Governing Council is expected to decide by the end of 2025 whether to move to the next stage.
Recent statements from ECB officials, including board member Piero Cipollone and former official Fabio Panetta, have underlined the importance of both the digital euro and euro-based stablecoins for maintaining the eurozone’s monetary sovereignty. For more on the ongoing digital euro project status, refer to the ECB progress document.
✅ Follow BITNEWSBOT on Telegram, Facebook, LinkedIn, X.com, and Google News for instant updates.
Previous Articles:
- Morgan Stanley: India to Lead BRICS with Fastest GDP Growth by 2026
- Hedera to Raise ConsensusSubmitMessage Fee to $0.0008 in 2026
- Galaxy Digital Handles Record $9B Bitcoin Sale Linked to 2011 Hack
- Clearmatics Unveils On-Chain Forecast Markets on Autonity Blockchain
- Tether’s USDT Supply Soars by $8B in July, Printing Concerns Rise
