Donald Trump’s support for US dollar-backed stablecoins will likely accelerate the European Central Bank’s (ECB) pursuit of the digital euro.
The ECB’s Pieor Cipollone informed Reuters that President Trump’s dedication to stablecoins could expedite the bloc’s central bank digital currency (CBDC) initiative. The board members anticipate that the European Union (EU) Parliament and Council will conclude the digital euro legislation by the summer of this year. This will allow the rule’s finalization in November 2025.
Support for Pro-stablecoin Policy
Cipollone informed the media outlet that the political world is actively alert to witness an accelerated process. The ECB board member acknowledges the complexity of political processes since they involve multiple considerations.
Cipollone expressed concerns about the growth in US stablecoins utilization as a payment means. The rise creates a worrisome situation capable of draining deposits from the European banks. A consumer within the EU bloc could prefer holding their cash in either Circle’s USD Coin (USDC) or Tether’s USDT. Such a consumer is likely to drain the bank account balances previously held within the bank in the EU region.
Cipollone’s statement is fresh off the Trump administration’s heightened activity in advancing pro-Stablecoin policies. Reflecting on the recent executive order, Trump reiterated the priority of shielding and promoting the sovereignty of the US dollar. He vowed to support actions to advance the growth of lawful dollar-backed stablecoins worldwide.
Trump Priority for Dollar-backed Stablecoin
The outcry by the ECB member emerges after the inaugural crypto-focused conference by While House crypto and AI Czar David Sacks. At the Tuesday, February 4 event, Sacks revealed the Stablecoin Bills is a legislative priority for the Trump administration.
Sacks promised that the first 100 days of Trump in office would feature a major stab at comprehensive stablecoin and crypto market structure bills. The press conference featured the Senate Banking Committee chair, Tim Scott, who backed the intention to enact both crypto bills under the Trump administration.
The pro-stablecoin support surfaced on Wednesday, Feb 5, with Tennessee Senator Bill Hagerty projects that the GENIUS Act proposal seeks to deliver a strong legal framework for the US stablecoin issuers within 100 days.
The ECB’s Cipollone criticism of Trump’s agenda aligns with his known criticism of the US dominance in financial services. Previously, he decried the continued reliance on the Mastercard and Visa networks by European countries rather than developing and nurturing their payment systems.
ECB Pursuit of Digital Euro
The ECB has since 2021 embarked on CBDC (digital euro) development. The Frankfurt-based authority entered the preparation phase in November 2023, and its conclusion is scheduled for November this year. At this stage, ECB targets to conclude the negotiation of procurement offers with potential providers of CBDC in Q1 for their selection in Q2 2025.
While November 2025 is the earliest of a potential rollout, the ECB recently updated the CBDC scheme rulebook, aiming to harmonize payments. This progress follows the joint review with retailers, consumers, and providers of payment services.
The rulebook is considered critical for standardizing the digital euro utilization and management within the bloc. It sees seamless management within the region concerning the payment service provider and country, becoming the euro area’s banknote.
The acceptance of the digital euro extends beyond President Trump’s influence, particularly with political figures within the EU opposed to the CBDC initiative. Such is evident in Sarah Knafo, who represents France in the European Parliament, who affirmed her opposition to the digital euro in a speech captured on X while approving strategic Bitcoin reserve.
The criticism by Knafo aligns with the position of fellow European member Jörg Meuthen. The German member accused the ECB of orchestrating a scheme to create a cashless society in the region. He considers the digital euro the perfect tool to facilitate surveillance and a digital-focused dictatorship.
