ECB cites financial stability risks
The ECB is pushing back on proposals to support euro stablecoin issuers due to concerns over financial stability risks.
The ECB’s resistance is led by President Christine Lagarde, who warns that stablecoin issuance can make bank deposits less stable.
At scale, this could accelerate disintermediation, raise bank funding costs, and erode the ECB’s ability to manage interest rates.
The ECB instead prefers tokenized financial infrastructure anchored by central bank money, citing projects like Pontes and Appia.