Joachim Nagel said euro-pegged stablecoins would give the bloc greater independence from US dollar-pegged coins that will soon be allowed under the GENIUS Act.
Joachim Nagel, president of Germany’s central bank, the Deutsche Bundesbank, supported the introduction of a euro-pegged central bank digital currency (CBDC) and euro-denominated stablecoins for payments.
In remarks prepared for a speech at the New Year’s Reception of the American Chamber of Commerce in Frankfurt on Monday, Nagel said EU officials were “working hard” toward the introduction of a retail CBDC. Euro-denominated stablecoins, according to the central bank president, could also contribute to “making Europe more independent in terms of payment systems and solutions.”
“Notably, a wholesale CBDC would allow financial institutions to make programmable payments in central bank money,” said Nagel. “I also see merit in euro-denominated stablecoins, as they can be used for cross-border payments by individuals and firms at low cost.”
Nagel’s remarks come months after U.S. President Donald Trump signed legislation establishing a framework for stablecoin payments in the country, potentially putting U.S. dollar-pegged stablecoins on a path that calls into question any possible launch of an equivalent euro-pegged currency. The Act is expected to be fully implemented 18 months after its signing or 120 days after the final development of the relevant regulations.
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The German central bank governor’s comments on stablecoins did not take into account the risks mentioned last week at the Euro50 Group meeting. Nagel warned that the country’s monetary policy “could be seriously undermined, not to mention European sovereignty” if U.S. dollar-denominated stablecoins had a much larger market share than euro-pegged coins.
Stablecoin profitability questioned in US bill under consideration
Washington lawmakers and White House officials met with representatives of the banking and crypto industries ahead of a potential vote on the CLARITY Act in the U.S. Senate. The bill, which is intended to provide a comprehensive regulatory framework for digital assets, has divided many cryptocurrency and banking industry leaders over its approach to stablecoin rewards, which has yet to be finalized in the legislation.
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