The cause for concern was a note by the Brussels-based think tank Bruegel. The authors of the document suggested:
– To relax liquidity requirements for issuers;
– to consider access to ECB funding;
– support the development of the European stablecoin market, which is currently dominated by dollar coins.
The idea was presented on May 22 at a meeting of financial officials in Nicosia. According to the agency, the initiative immediately met resistance from representatives of regulators, including ECB head Christine Lagarde, writes forklog.com.
The agency believes that the proliferation of stablecoins could weaken the stability of bank deposits. When a token is issued, users’ funds are transferred to the issuer’s accounts and cease to be a stable source of funding for banks.
Mass transfer of funds into steblecoins will also accelerate disintermediation, complicate fundraising and limit banks’ ability to issue loans, regulators fear.
Earlier in May, Lagarde was already critical of euro-stablecoins, instead supporting tokenized bank deposits. In her opinion, they combine the reliability of traditional accounts with the speed and programmability of distributed ledger technology.
Dollar in Europe
Bruegel warned that stricter regulation of stablecoins in the EU compared to the U.S. could push activity outside the bloc and increase “digital dollarization.”
A number of central bankers downplayed that risk. Some have renewed calls to enshrine in European law a ban on redemption of both EU and U.S.-issued stablecoins. In their view, this could put pressure on the reserves of local issuers.
The European Commission is now reviewing the MiCA regulation, which has been in place since 2024. It requires issuers of stablecoins to hold a significant portion of reserves in bank deposits and other liquid assets.
Reuters journalists noted that the GENIUS Act, passed in the U.S. in 2025, sets more lenient requirements and aims to support the global role of the dollar through regulated USD tokens.
According to Artemis data cited by Bruegel, the supply of stablecoins has grown by about a third to $300 billion in a year.
At the same time, the share of euro-linked tokens accounts for only 0.3% of the total supply. The largest of them – EURC from Circle – ranks about 20th in terms of capitalization among “stable coins”.
At the same time, Europe accounted for 38% of global transactions with stablecoins in the fourth quarter of 2025.
