The recent approval of a U.S. stablecoin law has sparked fresh urgency within Europe to accelerate its digital euro project, according to a report from the Financial Times.
Why This Matters
Last month, U.S. lawmakers passed the GENIUS Act, setting clear rules for the $288 billion stablecoin market — which is largely dominated by dollar-backed tokens like Tether’s USDT and Circle’s USDC.
The move caught many policymakers in Europe by surprise. It also raised concerns that dollar-based digital coins could strengthen America’s control over international payments. Officials fear that if the EU delays further, the euro could lose relevance in the global digital economy.
Rethinking the Digital Euro
Until recently, the European Central Bank (ECB) had been leaning toward developing a digital euro on a private, centrally managed system, with an emphasis on privacy and security. But with the U.S. now setting the pace, officials are increasingly open to exploring public blockchains such as Ethereum or Solana.
Supporters argue that building the digital euro on open platforms would allow it to circulate more freely, making it more competitive against dollar-backed assets worldwide.
Rising Competition
Pressure on Europe is mounting as other countries advance their own projects. China is already testing its digital yuan, while the U.K. is considering a digital pound. Although some euro-backed stablecoins, such as Circle’s EURC, already exist, their scale is far too limited compared with what a central bank–issued digital euro could achieve.
Next Steps
The ECB has confirmed that it is still assessing both centralized and decentralized technology options. While no final decision has been made, the U.S. move has clearly shifted the conversation and accelerated Europe’s timeline.
For the EU, this is no longer just about launching a new payment system — it’s about safeguarding the euro’s role in an increasingly digital global financial landscape.