ECB warns: US push for crypto policy could bring risk of financial crisis spreading
European Central Bank (ECB) has issued a warning about the potential consequences of the aggressive support from the United States for the cryptocurrency industry, stating that the surge in stablecoins pegged to the US dollar could destabilize the European financial system. According to a policy document obtained by POLITICO, the European Central Bank has requested revisions to the regulatory framework of the Markets in Crypto-Assets Regulation (MiCA) just months after it came into effect. The core of the controversy lies in the possibility that US reforms supported by President Trump could flood the European market with stablecoins pegged to the US dollar. The European Central Bank is concerned that this could lead to capital outflows from Europe to US assets, weaken the financial sovereignty of the European Union, and expose banks to liquidity risks. The European Central Bank warns that without stricter limitations, European issuers may face redemption pressures from EU and foreign holders, potentially triggering a financial "run" and harming related institutions.
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