The European Union is reportedly accelerating plans for a digital currency as stablecoins takeoff around the world.
The European Central Bank (ECB) is ramping up efforts to introduce a digital Euro currency as America’s new stablecoin law intensifies pressure on the continent to keep pace in digital assets.
The U.S. Congress recently approved the “GENIUS Act” that provides a framework for the $288 billion U.S. %Stablecoin sector.
Stablecoins are cryptocurrencies whose value is pegged to another asset, typically the U.S. dollar or price of gold.
The new U.S. law apparently caught many in Europe off guard and has raised concerns that dollar-pegged tokens could tighten America’s grip on cross-border payments.
As such, policymakers in Europe are now racing to launch a central bank digital currency (CBDC) on public %Blockchains like %Ethereum (CRYPTO: $ETH) or %Solana (CRYPTO: $SOL).
The European Central Bank has studied a digital Euro for years, pitching it as a public alternative to privately issued payment systems as cash use declines.
But until recently, the European Central Bank (ECB) had been lukewarm on the idea of a digital currency and repeatedly deferred action on the matter.
Now, the U.S. legislation has shifted the central bank’s focus, with policymakers open to decentralized networks that could help the Euro circulate more freely.
With China piloting a digital Yuan currency and the United Kingdom (U.K.) considering a digital pound, Europe faces mounting pressure to adopt a digital currency of its own, according to media reports.
