European Stability Mechanism Head Says Digital Euro ‘More Necessary Than Ever’

The Trump administration’s embrace of cryptocurrencies reportedly could accelerate the European Union’s (EU) adoption of a digital euro.

European Stability Mechanism (ESM) Managing Director Pierre Gramegna told reporters Monday (March 10) that Europe’s monetary autonomy and financial stability could be threatened by the Trump administration’s interest in cryptocurrencies and dollar-denominated stablecoins, Bloomberg reported Monday.

The Trump administration’s embrace of digital currencies could lead both U.S. and foreign tech giants to “launch mass payment solutions based on dollar-denominated stablecoins,” which would impact the euro area, Gramegna said, per the report.

The European Central Bank (ECB) has been developing a digital euro since 2021 and is set to decide whether to implement it later this year, according to the report.

In light of the change in the U.S. perception of digital currencies, Gramegna said, per the report, that the ESM believes that “this digital euro is today more necessary than ever.”

It was reported Thursday (Feb. 6) that the ECB hopes America’s new pro-crypto attitude can help bring about the digital euro.

The ECB is floating the idea of a digital currency to give Europe an electronic payment method that doesn’t depend on U.S. companies like PayPal or Visa.

Piero Cipollone, a member of the ECB board, told Reuters that President Donald Trump’s support for globally available stablecoins tied to the dollar adds another U.S.-made tool to that list and gives more urgency to the digital euro efforts.

“The political world is becoming more alert to this,” Cipollone said. “And it’s possible that we will see an acceleration in the process.”

Bundesbank President Joachim Nagel said in May — before the election of Trump — that central banks must speed up the adoption of digital currency to remain viable.

Speaking in May at the Bank for International Settlements Innovation Summit, Nagel said he was no longer sure if the central bank business model were “destroyable or not” and that distributed ledger technology (DLT) “is just a means, an instrument that could help us here get to that point.”

Nagel told attendees at the summit that “it’s a necessity to really get there” on the digital euro.