The rise of dollar-based stablecoins could put pressure on Europe’s monetary sovereignty. This is what Pierre Gramegna, director of the European Stability Mechanism (ESM), said in response to the crypto-friendly stance of the US administration under Trump.
Europe fears American crypto dominance
Gramegna warns that a US focus on cryptocurrencies could fuel tech giants’ plans for massive payment solutions with stablecoins. “If these initiatives are successful, this could have an impact on the financial stability and monetary autonomy of the eurozone,” he explained at a Eurogroup press conference.
According to the ESM director, the development of the digital euro is more urgent than ever. The European Central Bank (ECB) has been working on its own digital central bank currency (CBDC) for some time to secure Europe’s strategic autonomy. In February, the ECB announced that the development process of a CBDC payment system would be expanded with the aim of enabling efficient transactions between financial institutions.
Paschal Donohoe, the Irish finance minister, also shares these concerns. “What happens in other countries has an impact on us,” he stressed. He underlined that the discussion about cryptocurrencies is directly linked to the autonomy and resilience of the euro.
Dollar stablecoins versus the euro
Meanwhile, Trump is pursuing a different course. In January, he signed a presidential order banning the introduction and circulation of a digital US dollar (CBDC). At the same time, he set up a working group to study the role of cryptocurrencies in the economy. His government thus appears to have a preference for the free market, where stablecoins and other crypto solutions can grow without government interference.
The ECB remains skeptical about the role of Bitcoin and other cryptocurrencies in its reserves. ECB President Christine Lagarde stated that central bank reserves must be “liquid, safe and stable” – a characteristic that cryptocurrencies do not meet in her view. Therefore, she does not expect Bitcoin to take a place in the reserves of European banks.
The debate about the future of digital money in Europe and the US is becoming increasingly intense. While Washington embraces stablecoins and other cryptocurrencies, Brussels is trying to protect the euro from potential disruption. The outcome of this political contest could significantly change the future of the global financial system. There is a lot at stake for Europe: if dollar-based stablecoins dominate, the euro could lose influence in the global economy.
Image by Ashley_Jackson from Pixabay
TheBitcoinNews.com – Bitcoin News source since June 2011 –
Virtual currency is not legal tender, is not backed by the government, and accounts and value balances are not subject to consumer protections. TheBitcoinNews.com holds several Cryptocurrencies, and this information does NOT constitute investment advice or an offer to invest.
Everything on this website can be seen as Advertisment and most comes from Press Releases, TheBitcoinNews.com is is not responsible for any of the content of or from external sites and feeds. Sponsored posts are always flagged as this, guest posts, guest articles and PRs are most time but NOT always flagged as this. Expert opinions and Price predictions are not supported by us and comes up from 3th part websites.
Advertise with us : Advertise
For the latest cryptocurrency news, join our Telegram!
