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European Central Bank adviser Jürgen Schaaf has cautioned that a central bank digital currency (CBDC) will not be enough to compete with the rising use of US dollar-backed stablecoins.
In a July 28 blog post published on the ECB’s official website, Schaaf laid out several possible steps the European Union could take to strengthen its position in the crypto industry.
Among them were the promotion of well-regulated euro-pegged stablecoins, the adoption of blockchain-based technologies, and the continued rollout of the digital euro.
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Schaaf argued that public digital money should not be the only focus. He suggested that privately issued, euro-denominated stablecoins, if designed with clear rules and proper protections, might better meet real market needs. He also warned that failing to act in this area could be a costly oversight.
While public institutions often aim to remain neutral, he noted that such neutrality might backfire if Europe ignores the stablecoin market. According to him, well-managed euro-based tokens could help expand the euro’s presence globally.
He also addressed the need for more consistent rules across borders. Currently, the US and the EU are handling stablecoin oversight differently, with the GENIUS Act guiding US policy and the MiCA regulation setting the tone in Europe.
Schaaf highlighted that these different approaches may lead to fragmented oversight and missed opportunities.
Although he sees value in a CBDC, Schaaf noted that it should work together with private-sector developments and blockchain applications to protect Europe’s control over its monetary system.
Meanwhile, the Bank of England (BOE) recently reconsidered its plan to launch a CBDC. Why? Read the full story.
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