To combat the stable stables supported in US dollars, the European Central Bank accelerates the development of the digital euro.
This article explains the current situation surrounding the digital euro and its importance.
Why does the EU favor a digital euro?
The member of the board of directors of the ECB, Piero Cipollone, warned that the American stablecoins linked to the US dollar could threaten European banks. He quoted President Donald Trump’s new strategy to promote the stablescoins supported in dollars as a key concern. Like the money market funds, Stablecoins threaten banking income and customers with their call for global transactions.
Cipollone fears that stablecoins can harm banks in the euro zone by reducing their income and customer bases. He urges Europe to accelerate the launch of the digital euro, because this centralized digital payment method will receive support from the ECB.
Insight: The EU puts pressure on a digital euro to counter the promotion by Trump of the stablecoins supported by the United States. The ECB warns that the stalls could “disintermediary banks” on a global scale. pic.twitter.com/1egj0nq5ve
– Cointtelegraph (@cointelegraph) January 26, 2025
Insight: The EU puts pressure on a digital euro to counter the promotion by Trump of the stablecoins supported by the United States. The ECB warns that the stalls could “disintermediary banks” on a global scale. A digital currency must be designed to serve Europeans in the bank and not banished with simple payment capacities. Private banks would manage portfolios, but this digital currency would provide a reliable alternative to stablecoins and stimulated the financial system of Europe.
What holds the digital euro?
Banks selected in the euro zone region resist the thrust to implement this digital currency. The introduction has argued the concerns of the bank and could reduce customer deposits. From Cipollone’s point of view, the advantages of a digital euro exceed its potential drawbacks. However, its implementation depends on financial stability as the popularity of American stablescoins increases.
The European Central Bank (ECB) accelerates its digital euro plans following Trump’s executive decree promoting stablecoins from the private sector.
The member of the ECB board of directors, Piero Cipollone, warned … pic.twitter.com/d0qsv4vtdf
– Mario Nawfal (@marionawfal) January 26, 2025
The ECB is currently working in its experimental stage. The success of the project depends on the European legislators who adopt the necessary legislation. Time is crucial, because more than 40 countries, including China and Russia, are already testing digital currencies.
Trump’s executive decree prevents the federal reserve from creating a digital dollar. This hierartes stable and makes Europe feel the need to act immediately.
Just inside:
Trump’s executive decree prohibits all government agencies from taking any action to establish, issue or promote digital currencies of the Central Bank (CBDC) – Fox (@Eleanortrettt)) pic.twitter.com/gedjgl1ttn
– Radar πΈ Archie
(@Radarhits) Conclusion
The launch of a digital euro would demonstrate new ideas on economic freedom and financial power in global markets. A digital currency issued by Europe aims to protect its financial systems within its borders. Control of digital currency has become central for the current international difficulties, as nations intensify their daily needs. The future of European digital currency will become clear through current updates.
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