Europe accelerates digital euro plans after U.S. stablecoin law
The European Union (EU) is quickly accelerating its digital euro plans following the signing of the GENIUS Act, which introduced a number of crypto regulatory changes in the U.S.
Most notably, the act established the first comprehensive framework for the $288 billion U.S. stablecoin market, requiring issuers to maintain full liquid-asset reserves, secure licenses, and comply with strict disclosure rules.
These changes have sparked concerns worldwide that dollar-backed stablecoins could gain further footing, threatening the euro’s role in cross-border payments in the process.
Digital euro on Ethereum and Solana?
The European Central Bank (ECB) first proposed the digital euro in October 2021, envisioning a fully private ledger.
Now, officials are openly debating whether to instead issue the currency on public blockchains, such as Ethereum (ETH) or Solana (SOL), which would allow it to circulate more efficiently and increase its utility as a cross-border payment.
However, the idea is not without its critics, as some warn that public chains could increase privacy risks since transactions would be recorded on transparent ledgers.
What’s more, a closed system under ECB’s supervision would resemble China’s digital yuan, while a more open digital euro would complement the union’s open-market principles.
Given the difficulty of the matter, the outcome of the debate is certain to leave a great impact on Europe’s position in the digital payments landscape.
Featured image via Shutterstock
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