TechFlow, April 22 — According to Cointelegraph, the European Central Bank (ECB) has expressed concerns over the United States' aggressive policies supporting the cryptocurrency industry, warning that a surge in dollar-backed stablecoins could undermine the stability of Europe's financial system.
The ECB is calling for revisions to the Markets in Crypto-Assets (MiCA) regulation, which was implemented just months ago. The bank fears that U.S. reform initiatives backed by Trump could lead to an influx of dollar stablecoins into European markets, triggering capital outflows from Europe to U.S. assets, thereby damaging EU financial sovereignty and exposing banks to liquidity risks.
In response, some officials argue these warnings are overstated. Two diplomats and an EU official stated that despite U.S. plans to introduce the Stablecoin Transparency and Accountability Act (STABLE) and the Generative National Innovation for Ubiquitous Stablecoins Act (GENIUS), the existing MiCA framework is sufficient to manage stablecoin-related risks.
