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📌 European financial freedom under threat: ECB calls for digital euro to counter Trump’s proposal – Cryptoeconomics

The ECB is pushing for the creation of a digital euro to counter the Trump-led global rise of the US stablecoin. Digital currency

– The ECB is pushing for the creation of a digital euro to counter the Trump-led global rise of the US stablecoin.

The measure is designed to protect the European banking system from financial disintermediation resulting from the hegemony of the digital dollar.

CBDCs in Europe could pose significant risks to privacy, citizens’ financial control and individual economic freedom.

The introduction of digital currencies in Europe seems closer than ever, thanks in no small part to domestic innovation. According to Piero Cipollone, a member of the Executive Board of the European Central Bank (ECB), the need to introduce the digital euro has increased following former US President Donald Trump’s recent executive order. The move aims to strengthen the global dominance of stable dollar-backed coins, which could hinder traditional banks and jeopardize the European financial system.

The executive order signed by President Trump prioritizes the development of stable dollar-backed coins and promote the sovereignty of the U.S. currency in the digital space. Cipollone warned that this strategy not only reinforces the dominance of the dollar, but also weakens the role of European banks by shifting customers and services to technologically substitutable ones. Speaking at a conference in Frankfurt, Cipollone emphasized: President Trump used the key word ‘global’ in his executive order. This will lead to the disintermediation of banks, which will lose customers, commissions and relevance in the financial system.

In response, the ECB has proposed the introduction of a digital euro managed by central banks and private organizations such as banks. Such a system would allow citizens to make digital payments without the need for a traditional bank account. However, the proposal limits individual balances and does not allow for earning interest, which could limit its widespread adoption.

As the ECB accelerates testing of the digital euro, criticism of the risks of a central bank digital currency (CBDC) is growing. While the project promises to expand financial inclusion, many analysts have raised serious concerns about privacy and control. By centralizing all transaction information in one institution like the ECB, European citizens could face unprecedented scrutiny of their financial activities.

In response, Trump has once and for all rejected the idea of issuing digital dollars under the auspices of the Federal Reserve and has expressed private coinage in favor of the proliferation of stablecoins. This approach, though controversial, is in line with the principles of financial freedom that could be threatened in Europe if the digital euro becomes a reality.

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