Lagarde Says ECB Needs Tokenised Money, Not Crypto Stablecoins
ECB President Christine Lagarde argues Europe should not respond to dominant US dollar stablecoins by creating its own euro-denominated versions. Instead, she advocates for building tokenised financial infrastructure based on central bank money.
Lagarde acknowledges stablecoins' growth and role in crypto settlement and cross-border payments, but identifies key risks: financial stability vulnerabilities, as shown by USDC's depegging during the Silicon Valley Bank collapse, and potential disruption to monetary policy transmission in the euro area.
She contends that promoting private euro stablecoins under MiCAR would offer limited benefits for the euro's international role while introducing material trade-offs. A more effective path to strengthening the euro involves deeper capital market integration and developing a safe asset base.
Lagarde is constructive on the transformative potential of DLT-based market infrastructure for Europe's fragmented financial system. The ECB's strategy focuses on public solutions like the Pontes project for wholesale settlement in central bank money and the Appia roadmap for an interoperable tokenised ecosystem by 2028. The goal is to harness innovation's benefits without replicating fragile instruments from elsewhere.
bitcoinist05/08 21:30
