The growing concern over dollar-based stablecoins in Europe

 Stable coins growing concern:

Italy’s finance minister, Giancarlo Giorgetti, has expressed worry about how popular U.S. dollar-backed stablecoins are becoming in Europe. He believes these digital currencies might harm the euro more than traditional trade tools like tariffs. These stablecoins let people send money across borders using U.S. dollars, even if they don’t have a bank account in the U.S., which could weaken the euro’s role in world trade.

Giorgetti shared his thoughts during a speech in Milan. He said that while stablecoins may seem helpful, they actually make Europe more dependent on the U.S. financial system. Since people can easily use digital dollars, fewer may rely on the euro for global transactions. This could slowly push the euro aside, even within Europe.

To prevent this, Giorgetti is calling on European Union leaders to act. He wants them to work harder to keep the euro strong and important in the world. One of the main solutions he supports is the development of a digital euro. He believes that having a European version of stablecoins will help protect the region’s financial independence.

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At the same time, the United States is also working on rules for stablecoins. On April 2, an important U.S. committee approved the STABLE Act. This law is designed to make stablecoin issuers more open about their actions and to hold them responsible. The idea is to make sure these companies are safe and fair for people who use them.

Another proposed law in the U.S., the GENIUS Act, goes even further. It would require stablecoin companies to keep strong reserves, follow anti-money laundering rules, and protect users. However, this law is still waiting for full approval by Congress before it can take effect.

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Piero Cipollone, a key official from the European Central Bank, agrees with Giorgetti. He also believes that Europe needs a digital euro to protect its financial freedom. Cipollone says that without it, the eurozone could lose control over its own money systems, as more people and businesses choose to use dollar-backed digital currencies instead.