ECB President Lagarde Advocates Stringent Rules for Foreign Stablecoins

European Central Bank (ECB) President Christine Lagarde emphasized the need for strict regulations on foreign stablecoins during a speech at an ESRB conference in Frankfurt. Key points include:

Stablecoins must comply with EU regulatory standards before operating within the EU.
During a stablecoin run, investors may redeem assets in jurisdictions with stronger protections, potentially impacting local reserves.
Lagarde highlighted past risks of liquidity mismanagement across jurisdictions, referencing banking group requirements for reserves.
Robust regulation is necessary to prevent arbitrage and maintain financial stability across borders.
Stablecoins have become a focal point for digital asset regulation globally in 2025.
The U.S. and Hong Kong have introduced their own stablecoin regulations, following the EU's MiCA framework.