ECB sees risk to euro stability as US stablecoins surge

• US Stablecoins Challenge EU Monetary Sovereignty
• STABLE and GENIUS projects boost digital dollar
• MiCA faces criticism for stifling crypto innovation

The European Central Bank (ECB) has expressed serious concern about ongoing regulatory developments in the United States regarding the stablecoin market. According to the European monetary authority’s latest statement, US legislative proposals — such as the STABLE and GENIUS bills — could accelerate the global expansion of dollar-pegged tokens, directly impacting the eurozone’s financial balance.

The ECB's assessment highlights the risk of disorderly growth of these stablecoins in Europe, especially if local regulation fails to keep up with the pace of external innovation. One of the main points raised was the potential drain of liquidity from banks in the region, which would compromise the effectiveness of monetary policy and the sovereignty of the euro in relation to the digital dollar.

Lagarde worried Digital Euro, MiCA, are failures and the US will dominate the stablecoin business.

The worry is warranted. However, the EU had the first mover advantage with the regulation and they screwed it up. In the EU stablecoin is internationally competitive because the… pic.twitter.com/IXExwrFPzQ

- Mikko Ohtamaa (@moo9000) April 22, 2025

Meanwhile, the European Commission maintains its position that the MiCA regulation already provides a solid basis for dealing with this emerging market. However, the disagreement between Brussels and Frankfurt highlights the lack of internal alignment on the best institutional response.

Furthermore, governments such as Italy have already expressed concerns about the growing dominance of the dollar in global payment systems, warning of the risk of the euro losing international relevance.

In light of this scenario, the ECB is evaluating additional measures to contain excessive exposure to foreign digital assets and preserve the economic stability of the euro area.