Europe is actively trying to stop the dollar stablecoin takeover
Europe has huge stablecoin usage but almost no euro-denominated supply: Europeans account for 38% of global stablecoin transactions, while euro tokens are only 0.3% of supply. ECB President Christine Lagarde and other central bankers oppose loosening MiCA rules or giving stablecoin issuers access to ECB funding, warning that larger euro stablecoin issuance could pull deposits out of banks, reduce lending, and weaken monetary-policy transmission. A Bruegel proposal to ease liquidity rules and provide ECB backstop support was rejected. The ECB instead favors tokenized payments anchored in central bank money and plans a digital euro by 2029. Internal EU views are split, with Bundesbank President Joachim Nagel more supportive of euro stablecoins. Meanwhile, private initiatives like the bank-backed Qivalis consortium are moving ahead. The broader concern is that dollar stablecoins, already about 98% of supply and reinforced by US law, could deepen digital dollar dominance before Europe offers a competitive alternative.
