ECB dey warn on euro stablecoins, dem prefer central-bank tokenized settlement pass USDC/USDT

ECB President Christine Lagarde push back against calls to use euro stablecoins to fight dollar dominance. She tok say stablecoins don grow from under $10B to over $300B, but market still mostly USD-denominated and dominated by Tether and Circle. Lagarde argue say once you separate a stablecoin’s monetary role from its technology role, the case for euro stablecoins weakens. She warn say dem fit make financial stability stress worse, weaken how monetary policy work, and put pressure on banks if value move from deposits to non-bank token instruments. She also point out fragility risks with private stablecoins, like possible de-pegging and fragmentation of tokenized markets. Instead, ECB want public tokenized settlement infrastructure backed by central bank money. Eurosystem plan wholesale settlement via Pontes in September, linking DLT platforms to TARGET for central-bank-money settlement. Appia roadmap aim for a fully interoperable European tokenized financial system by 2028. Later industry view (Bitget Wallet’s Alvin Kan) note say regulated euro stablecoins under Europe’s MiCA framework could improve transparency and reserve concerns. But adoption fit be the bottleneck: if Europe no fit deliver scalable euro stablecoins, users might stay with USDC/USDT because of entrenched liquidity and network effects, possibly creating split market where institutional tokenized finance use regulated rails while retail payments and DeFi continue to lean on USD stablecoins. For crypto traders, main takeaway be that euro stablecoin progress likely slower and infrastructure-led rather than a near-term “USDC/USDT swap,” which may support the existing USD stablecoin liquidity advantage.