Italy's Economy Minister Warns of Dollar-Based Stablecoin Threat to Eurozone

Italy’s Minister of Economy, Giancarlo Giorgetti, has expressed significant concerns about the increasing influence of dollar-backed stablecoins in Europe. Speaking at an asset management conference in Milan, Giorgetti highlighted that these digital assets, which are pegged to the U.S. dollar, present a more substantial threat to the eurozone than traditional economic challenges such as tariffs or trade wars.

Stablecoins, particularly those tied to the U.S. dollar, are rapidly gaining popularity worldwide as efficient tools for international transfers, payments, and investments. Their appeal stems from offering the speed and flexibility of cryptocurrencies while mitigating the price volatility typically associated with them. However, Giorgetti sees a more sinister aspect to their rapid growth in Europe.

“These dollar-based stablecoins are silently shifting financial influence,” Giorgetti stated. “They’re not just a convenience, they’re a strategic threat to our monetary independence.” His remarks come at a time when the usage of these digital assets is increasing in Europe, especially among young, tech-savvy users and cross-border businesses who prefer their efficiency over traditional banking options.

In response to the growing reliance on non-European digital currencies, the European Central Bank (ECB) is advancing its plans to launch a digital euro. This initiative aims to provide European residents with access to a government-backed digital wallet for daily transactions, online payments, and peer-to-peer transfers. The digital euro is being promoted as a modern, secure alternative to privately issued stablecoins, particularly those pegged to the dollar.

However, the digital euro project faces challenges. European commercial banks have expressed concerns that widespread use of a digital euro could lead to a mass migration of customer deposits from private banks to ECB-controlled wallets. This shift could destabilize traditional banking systems and reduce banks’ ability to issue loans.

Giorgetti used his platform to advocate for unity and urgency among EU member states and financial institutions. He emphasized that Europe’s fragmented payments landscape and slow adoption of financial technology are making the region vulnerable to outside digital currency dominance. “The U.S. has a clear strategy to expand its digital footprint through regulation and innovation. If we don’t match that energy, we risk being outpaced,” he warned.

Giorgetti also suggested that Europe should accelerate regulatory clarity around crypto assets and make a stronger push to promote the euro as a globally preferred currency, not just in traditional finance but in digital markets as well.

As U.S. regulators adopt a more permissive stance on cryptocurrencies and stablecoin frameworks, Europe is being forced to confront the strategic implications of falling behind in the digital currency race. For leaders like Giorgetti, this isn’t just about technology; it’s about sovereignty, power, and long-term economic stability. Whether the digital euro becomes a mainstream reality or not, Europe’s response to the rise of dollar-based stablecoins will likely shape the future of monetary policy and digital finance across the continent.