“EU Representative Calls for Euro Stablecoins to Challenge US Dollar Dominance”

A high-ranking official from the European Union has advocated for the establishment of euro-backed stablecoins to contest the supremacy of U.S. dollar-pegged tokens in the global cryptocurrency markets.

Pierre Gramegna, managing director of the European Stability Mechanism (ESM), stated that Europe needs to expedite its initiatives to issue domestic stablecoins and enhance its digital financial independence.

“Europe should not rely on U.S. dollar-denominated stablecoins, which currently dominate the markets,” Gramegna remarked during a Thursday hearing focused on the eurozone’s economic outlook, where digital assets were among the discussed subjects.

He further noted that “Stablecoins are an essential component of this equation. In a swiftly changing financial environment, Europe should strive to promote the creation of euro-denominated stablecoins by local issuers.”

Digital Euro Gains Traction as EU Considers Strategy to Address U.S. Crypto Advantage

Gramegna’s remarks arise amid increasing apprehensions that the U.S. is establishing a significant advantage in the digital currency sector following the rollout of the GENIUS regulatory framework earlier this year, which has fueled the growth of dollar-backed stablecoins like USDC and USDT.

European officials express concern that ongoing dependence on U.S.-issued tokens could weaken the EU’s authority over its financial system and payment infrastructure.

Paschal Donohoe, president of the Eurogroup, endorsed Gramegna’s viewpoint on financial innovation but highlighted that the European Central Bank’s (ECB) digital euro initiative could also be crucial in modernizing payment systems.

“The digital euro could still provide a net benefit for commerce in the region,” he stated.

Momentum is already gathering behind the digital euro project. According to ECB Executive Board member Piero Cipollone, the central bank may introduce a digital euro by 2029 as discussions among member states advance.

A digital euro could launch in 2029, says ECB board member Piero Cipollone, citing growing momentum and progress in member-state talks.#digitaleuro #ECBhttps://t.co/yn43I38DdH

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He characterized recent discussions as a “major breakthrough” after finance ministers from the euro area reached an agreement on customer holding limits to safeguard bank deposits.

Cipollone indicated that by early May next year, the European Parliament should establish a position on the legislative framework supporting the project, following an October progress report and several negotiation rounds.

Member states are also anticipated to achieve a general consensus by the end of this year.

The digital euro aims to lessen Europe’s dependence on private payment firms such as Visa and PayPal, while also diminishing the influence of dollar-denominated stablecoins in the region.

Nonetheless, several technical and policy issues remain unresolved, including privacy protections, bank coexistence, and whether the currency should function on a public blockchain like Ethereum or Solana.

European officials are accelerating the digital euro initiative, considering Ethereum or Solana, as pressure mounts to keep pace with U.S. advancements in digital currencies.#DigitalEuro #ethereum #Solana https://t.co/vMzIfEMIdu

— Cryptonews.com (@cryptonews) August 22, 2025

Proponents argue that euro stablecoins and a digital euro could enhance Europe’s competitiveness in the global financial landscape, while critics caution that regulatory delays could leave the region lagging behind the U.S. in shaping the future of digital payments.

Europe Intensifies Stablecoin Initiative to Address U.S. Dollar Dominance

European policymakers and financial institutions are ramping up efforts to create euro-backed stablecoins, aiming to counter the significant dominance of U.S. dollar-pegged tokens.

In July, European Central Bank (ECB) advisor Jürgen Schaaf called for enhanced global coordination on stablecoin regulation, cautioning that discrepancies between U.S. and EU frameworks could reinforce dollar dominance.

ECB advisor warns Europe risks losing monetary sovereignty as euro-denominated stablecoins capture just 0.15% of $230 billion global stablecoin market.#Europe #Stablecoinhttps://t.co/ztXdNdvv1C

— Cryptonews.com (@cryptonews) July 29, 2025

In a post on the ECB’s website, Schaaf advocated for “properly regulated euro-denominated stablecoins,” asserting they could bolster Europe’s monetary sovereignty if developed with strong safeguards.

Schaaf pointed to the U.S. GENIUS Act, enacted in July, as “broadly aligned” with the EU’s Markets in Crypto-Assets (MiCA) framework but less rigorous in certain aspects. He emphasized the need for consistent global standards to avoid market fragmentation and regulatory arbitrage.

The ECB advisor’s comments follow earlier concerns from Bank of Italy Governor Fabio Panetta, who highlighted the limited uptake of euro stablecoins despite the rollout of MiCA.

Panetta suggested that the digital euro could help bridge that gap, while Schaaf stressed that private innovation and distributed ledger technology (DLT) must complement public initiatives.

The ECB has already authorized two DLT pilot projects, Pontes and Appia, aimed at enhancing wholesale and cross-border payments.

Simultaneously, nine of Europe’s largest banks, including ING, UniCredit, CaixaBank, and Danske Bank, have announced plans to collaboratively launch a euro-backed stablecoin in 2026.

Nine European banks will launch a MiCA-regulated, euro-backed stablecoin that will contribute to Europe’s strategic autonomy in payments.#EURStablecoin #MiCARegulationhttps://t.co/FEUGRf7hgS

— Cryptonews.com (@cryptonews) September 25, 2025

The consortium aims to obtain licensing under MiCA and promises faster, more affordable, and round-the-clock cross-border transactions.

This initiative underscores Europe’s increasing resolve to diminish reliance on U.S. stablecoins, which represent approximately 99% of the global supply.

ECB data indicates that euro-pegged tokens remain below €350 million in circulation, a gap that European regulators and banks now seem determined to address.

The post “Europe Must Compete”: EU Official Demands Euro Stablecoins to Break US Dollar’s Monopoly appeared first on Cryptonews.