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Christine Lagarde has questioned the growing push for euro-denominated stablecoins, arguing that they are unlikely to strengthen the euro’s global standing or enhance Europe’s monetary sovereignty.
Speaking on the future of digital finance in Europe, the European Central Bank president said the case for euro-backed stablecoins is “far weaker than it appears,” despite increasing global momentum around digital currencies and tokenised payments.
The remarks come amid rapid growth in stablecoin adoption, particularly in the United States, where the administration has backed dollar-pegged stablecoins through initiatives such as the GENIUS Act as part of efforts to reinforce the international dominance of the US dollar.
In Europe, concerns over potential “digital dollarisation” have prompted several major banks to explore a privately issued digital euro as a regional alternative. Supporters argue that without a competitive euro-based digital payment ecosystem, Europe risks losing greater control over its financial infrastructure.
Lagarde, however, maintained that replicating foreign models is not the right strategy for Europe.
“The best solution remains the same: more integrated capital markets through the savings and investment union, and over time a safe asset base that matches the scale of our ambitions for the euro’s international role,” she stated.
Rather than relying on privately issued stablecoins, the ECB president stressed the importance of building a stronger financial architecture anchored by central bank money.
She noted that the future of digital settlement should focus less on which private digital asset succeeds—whether stablecoins, tokenised deposits, or other emerging instruments—and more on ensuring there is a trusted common settlement layer within the financial system.
As part of this strategy, the ECB is advancing infrastructure projects designed to support Europe’s evolving tokenised economy. One of these initiatives is Pontes Project, which is expected to launch in September and will connect distributed ledger technology (DLT) platforms with the ECB’s TARGET settlement system, enabling transactions to settle directly in central bank money.
The ECB is also progressing with the Appia Roadmap, published in March, which outlines plans for a fully interoperable and tokenised European financial ecosystem by 2028.
Lagarde concluded that Europe’s priority should be to build financial systems aligned with its own long-term strategic goals rather than imitate digital instruments developed elsewhere.
“Our task is not to replicate instruments developed elsewhere, but to build the foundations and infrastructure that serve our own objectives,” she said, adding that Europe must embrace innovation without importing external vulnerabilities into its financial system.
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