Ex-ECB Official Urges Europe to Back Euro Stablecoins or Risk Losing Financial Power

Key Points

1. Stablecoins are a $255 billion sector, with $241 billion concentrated in U.S. dollar-backed tokens.

2. Lorenzo Bini Smaghi argues that Europe's hesitation could lead to a loss of monetary sovereignty as consumers might shift to U.S.-linked platforms.

3. The European Union has the Markets in Crypto-Assets (MiCA) law, but policymakers are slow to adopt new technology.

4. Smaghi suggests that sponsoring euro-pegged stablecoins and coordinating standards could modernize cross-border payments and unify Europe’s capital markets.

5. Société Générale, where Smaghi is chair, launched a euro-backed stablecoin in 2023 and a U.S. dollar-backed one recently.