“Europe Must Compete”: EU Official Demands Euro Stablecoins to Break US Dollar’s Monopoly

A senior European Union official has known as for the creation of euro-backed stablecoins to problem the dominance of U.S. dollar-pegged tokens in international crypto markets.

Pierre Gramegna, managing director of the European Stability Mechanism (ESM), said Europe should speed up its efforts to difficulty home stablecoins and strengthen its digital monetary sovereignty.

“Europe shouldn’t be depending on U.S. dollar-denominated stablecoins, that are at present dominating markets,” Gramegna mentioned throughout a Thursday listening to on the eurozone’s financial outlook, the place digital property had been among the many subjects mentioned.

He added that “Stablecoins are an inevitable a part of this equation. In a quickly evolving monetary panorama, Europe ought to do its finest to facilitate the era of euro-denominated stablecoins by home issuers.”

Digital Euro Gains Momentum as EU Debates Strategy to Counter U.S. Crypto Lead

Gramegna’s feedback come amid rising issues that the U.S. is gaining a decisive lead within the digital forex house following the introduction of the GENIUS regulatory framework earlier this year, which spurred progress in dollar-backed stablecoins corresponding to USDC and USDT.

European officers fear that continued reliance on U.S.-issued tokens might undermine the EU’s management over its monetary system and fee infrastructure.

Paschal Donohoe, president of the Eurogroup, supported Gramegna’s stance on monetary innovation however famous that the European Central Bank’s (ECB) digital euro undertaking might additionally play a significant function in modernizing funds.

“The digital euro might nonetheless be a web optimistic for commerce within the area,” he mentioned.

Momentum is already constructing behind the digital euro initiative. According to ECB Executive Board member Piero Cipollone, the central bank could roll out a digital euro by 2029 as discussions amongst member states progress.

He described latest talks as a “main breakthrough” after euro space finance chiefs reached consensus on buyer holding limits to shield financial institution deposits.

Cipollone mentioned that by early May subsequent yr, the European Parliament ought to have a place on the legislative framework underpinning the undertaking, following an October progress report and several other rounds of negotiations.

Member states are additionally anticipated to attain a normal settlement by the top of this yr.

The digital euro is designed to scale back Europe’s reliance on non-public fee firms corresponding to Visa and PayPal, whereas additionally curbing the affect of dollar-denominated stablecoins within the area.

However, a number of technical and coverage questions stay unresolved, together with privateness safeguards, financial institution coexistence, and whether or not the forex ought to function on a public blockchain such as Ethereum or Solana.

Supporters argue that euro stablecoins and a digital euro might reinforce Europe’s competitiveness in international finance, whereas skeptics warn that delays in regulation might go away the area additional behind the U.S. in shaping the way forward for digital funds.

Europe Steps Up Stablecoin Push to Counter U.S. Dollar Dominance

European policymakers and monetary establishments are intensifying efforts to develop euro-backed stablecoins, in search of to counter the overwhelming dominance of U.S. dollar-pegged tokens.

In July, European Central Bank (ECB) adviser Jürgen Schaaf known as for stronger global coordination on stablecoin regulation, warning that gaps between U.S. and EU frameworks might reinforce greenback supremacy.

ECB advisor warns Europe dangers dropping financial sovereignty as euro-denominated stablecoins seize simply 0.15% of $230 billion international stablecoin market.#Europe #Stablecoin https://t.co/ztXdNdvv1C

— Cryptonews.com (@cryptonews) July 29, 2025

Writing on the ECB’s web site, Schaaf urged help for “correctly regulated euro-denominated stablecoins,” arguing they might strengthen Europe’s financial sovereignty if designed with sturdy safeguards.

Schaaf pointed to the U.S. GENIUS Act, signed into regulation in July, as “broadly aligned” with the EU’s Markets in Crypto-Assets (MiCA) framework however much less stringent in sure areas. He mentioned constant international requirements are wanted to forestall market fragmentation and regulatory arbitrage.

The ECB adviser’s remarks observe earlier issues from Bank of Italy Governor Fabio Panetta, who noted the limited adoption of euro stablecoins despite MiCA’s rollout.

Panetta mentioned the digital euro might assist bridge that hole, whereas Schaaf emphasised that personal innovation and distributed ledger expertise (DLT) should complement public initiatives.

The ECB has already approved two DLT pilot projects, Pontes and Appia, aimed toward enhancing wholesale and cross-border funds.

At the identical time, 9 of Europe’s largest banks, together with ING, UniCredit, CaixaBank, and Danske Bank, have announced plans to jointly launch a euro-backed stablecoin in 2026.