ECB Proposes Digital Euro Amid Trump’s Promotion of Stablecoins
The European Central Bank (ECB) is advocating for a Central Bank Digital Currency (CBDC), specifically the Digital euro, in response to President Trump's promotion of dollar-backed stablecoins. ECB board member Piero Cipollone stated that without a digital euro, EU banks could lose clients and fees as customers might prefer stablecoins.
Key Points
- Trump's executive order promotes dollar-backed stablecoins, potentially drawing customers away from EU banks.
- CBDC will provide an online payment option guaranteed by the ECB, accessible even to unbanked individuals.
- Digital euro holdings may be capped at a few thousand euros without accruing interest.
- Concerns exist that the digital euro could lead to reduced bank deposits.
- Trump has banned the Federal Reserve from creating a CBDC and has criticized such currencies as “very dangerous.”
- EU's Market in Crypto Assets (MiCA) legislation requires licensing for crypto firms operating within the EU.
- Companies like MoonPay and HashKey have begun obtaining MiCA licenses to operate in the EU.